President and Governing Body of FAIITA, after prudently considering the favourable response received from Acer with reference to submitted Memorandum, has unanimously resolved to revoke the purchase Deferment of Acer products with immediate effect, subject to Acer aligning their regional teams with regional IT Associations and clarify the process of agreed compensation on exceptional disruption of Prices across all GTMs including but not limited to Amazon, Flipkart, Paytm & LFR etc.
All member State Associations/Federations are advised to further intimate their members to resume normal business with Acer, said, Saket Kapur, General Secretary, FAIITA.
Notably Purchase Deferment of Dell, Asus, products continues as per last Advisory till a favourable response is negotiated, said, Champak Raj Gurjaar, President, FAIITA.
When compared to other brands, Acer has been supporting us from the initial days to fight with online price, this was the only brand which accepted to pay the difference of loss to the channel community from the time channel was facing problem. But, lack of proper communication from the brand owners about the festival sale affected our business in large, said, Deepak Bommisetty, Regional Jt. Secy South, FAIITA.
As discussed, Pl find Below Acer response on the points raised by FAIITA:
As an owner of one of the largest IT brand, our engagement with contractually committed B&M business partners is of paramount importance to us. We understand our responsibility to provide positive and healthy business environment to our business partners. After our lengthy discussions with FAIITA members, having substantial business stakes in retail, it is unanimously felt that there is a dire need to create and maintain level playing field across GTMs’ to ensure market hygiene for business sustenance & growth of B&M business partners. Our commitment to our B&M partners can be understood by our acceptance to the below points raised by the members and we are going the extra mile to ensure a level playing field and in some cases advantages to B&M partners of Acer through our B&M partner policies and schemes, said, Raja Bhat, National Sales & Program Manager, Acer India.
1. There is a market need of one Nation and nearly one Price of your product range to obviate customer confusion on correct time, price and place to buy.
a. Acer Agrees to meet point number 1 raised by FAIITA throughout the year across all online platforms. And in case any disturbance found, Acer is committed to control same immediately
2. Contractually B&M partners should be able to match visibly most competitive price of your products, moreover the brand owner/OEM ensure seamless earning of a minimum sustenance business margin of 5% across entire product range.
a. Acer agrees to the point that B&M partners should have fair play in terms of price compared with online sellers throughout the year. Acer will also address a uniform end user price based on Product design / ID, comparable configuration and accessories such as inclusion or exclusion of bag as the case may be. In the event of any price gap in online portal, Acer will immediately allow authorised B&M partner to match the price. And this will be subject to end user verification and also purchase verification
b. Contractual T2 partners will be covered directly by Acer
c. T3 will be covered by Acer MR (Master Reseller) who is selling to T3 through Acer Program Letter – The mechanism of covering T3 will be shared with in 2-3 Weeks
3. During Sales Promotion period at online portals (or any other such promotional disruptive price fair), there will be a similar sale at B&M partners with similar pricing fully supported by Brand Owners, ensuring a minimum 5% Margin across entire product range.
a. Being the brand owner we are committed to supporting our B&M partners with the following actions.
i. Price difference computed will be based on equated EUP for all price list models.
ii. B&M Partner Listed EUP vs OLS EUP will be the gap support after spec equation.
iii. This will be subject to audit done by Acer in terms of Price, Specification and configuration intra alignment, End User verification and Partner purchase data.
4. Brand Owners/OEMs shall inform all registered B&M partners at least two weeks in advance; about likelihood of Sales Promotion activity by OLS, and advise partners to inform all footfall customers about it and stock products that will sell during OLS sales, to be in sync with online.
a. Acer will do the needful as and when the information is made available to us by the online portals.
5. The brand owner shall also endeavour to augment the business in the offline channels during such discount periods proportionately to the surge in online sales of its products and provide special visibility through various marketing campaigns as per respective brand promotion strategies.
a. During big promotional days in online portals, Acer will maximise its efforts in to drive traffic to Acer Authorised Partners stores through various marketing mediums. We will run special schemes and consumer promotions applicable only to B&M partners and their customers. An example is the “Acer Week Dhamaka” special offer designed to improve the sales and profitability of B&M Partners run during the online sale period.
6. During sale period, products in stock of B&M partners of nearly similar specifications and configurations as being promoted by OLS will be treated as same and Partners shall be allowed to earn a minimum 5% sustenance margin on sale of these products during promotional period.
a. Covered in Point 2.
7. A partner agreed Price differential matrix of Product Configuration/Specifications will be submitted by Brand Owner for arriving at stack price of various configurations of products, keeping in mind a minimum of 5% sustenance margin.
a. Covered in Point no.2
8. All the price parity compensatory claims to be settled by Brand Owners within one week.
a. Acer Agrees and It will be done as per current policy of claims processing and we will take this up on priority.
9. Targets in post disruptive periods to all B&M partners shall be assigned on basis the actual sell out achieved by B&M partners and not construed to push inventory to them.
a. Acer agrees to the revision of partner target post mutual discussions with the partners in accordance with certain business objectives. In case of termination of partner agreement, Acer will continue the same practice which Acer follows today and there will not be any change in the said policy.
10. In the event of termination of partner agreement, it shall be responsibility of brand owner to clear within reasonable time, the unsold inventories of the terminated partner.
a. Covered in Point 9.
11. During price disruption happened last festive sale our members are piled up with huge stocks for which viable solution is required from vendors so that there loses are covered and there stocks are liquidated.
a. This is not true in case of Acer by and large. However keeping B&M partners’ interest in mind we will discuss to compensate the partner in terms of credit days and Interest cost for select SKUs purchased by B&M partners between 25thSept to 15th Oct 2018.Process for the same is as under
i. Acer contractual partner to approach Acer RBM to explore one time reversal
ii. This is applicable on AMD A4 and Corei5 SKUs
iii. Subject to payments of T1 outstanding by 15th Dec 2018, Acer will work with respective authorised T1s for interest waiver.
12. As a matter of fact our Members are liable to pay overdue interest on all outstanding to your Distributors consequently ad idem interest is justifiably payable by you to them towards overdue incentives/back ends claimed.
a. Covered in Point 11.
The IT landscape has changed drastically due to changing consumer behaviour and new ways of buying and selling. Acer which has deep roots in the B&M partner community is committed to protecting the interest of our retail partners and we will take all possible measures to ensure B&M partners can perform and grow the business by being an integral part of Acer’s growth strategy. We also seek your support and expect all B&M partners to not indulge in selling Acer products through online portals without our approvals thereby violating MOPs in the market and hampering earning potential of both brand as well as partner fraternity. By living up to the true meaning of a partner we can succeed together serve our customers by the best possible means. Acer would like to reinstate that all the above points will be applicable for all Acer authorised MOU partners.