FAIITA targets One Nation One Price One Voice
“We Do Match Online Prices…………..”
Federation of All India Information Technology Associations (FAIITA), the IT Community in India which comprises of hundreds of IT Associations in most of the district nationwide was formed for the consolidation and the betterment of the IT ecosystem in India. This involves not only the Business Community in the IT Vertical, but also the end-users of the IT Products. With a thought that IT products are progressively reaching all corners of India, it was started with a long-term vision and a mission to accomplish over time. Today, FAIITA is associated with most of the district level IT Associations reaching the mass as well as State level federations.
Online retail sales in India is expected to grow by 31% this year to touch $32.70 billion, led by e-commerce players Flipkart, Amazon India and Paytm Mall, according to a report. However, India’s growth rate in e-commerce is yet to catch up with countries such as China and Indonesia in the Asia Pacific market. Flipkart, Amazon and Paytm Mall have been expanding into new sectors, and with Walmart’s recent $16 billion acquisition of Flipkart, e-commerce in India is expected to launch more offline retail stores also playing a larger role in Computers, Laptops, Mobiles and Electronic accessories. However, E-commerce in India is yet to get into its stride. The online retail market in India has more than tripled since 2015 and its expected to change in the coming years. By 2022, the sector will be worth $71.94 billion, which is a 120% growth compared to $32.70 billion in 2018, a report said.
“In tandem with this shift to online and mobile usage, Flipkart, Amazon and Paytm Mall have been competing fiercely to claim their share of the Indian market. All three are making large investments, which include improved logistics and payment systems, as well as offering deep discounts, which will fuel future growth in the market.
The stocks purchased by the small and big IT dealers has stuck up this year due to massive festival offers and campaigning by online players and the question of survival is clicking every IT dealers mind. The future seems to be blank with a big question mark for small players as well as big players. At this moment of crisis, FAIITA has taken the responsibility to organise a meeting with the brand owners and regional IT associations, also representatives of firms to sit in one place by finding out a long term solution to safeguard the traditional business community. The meeting was organised on 21st November in Mumbai at Hotel Avion, Nehru Road, Navpada, Vile Parle East, Mumbai which concluded with a fairly positive note.
Around 35 delegates representing from various state/regional associations across India gathered in Mumbai for a fair discussion with brand owners/OEMs. The meeting was held with each and every partner representatives explained their problems. Memorandum was submitted to the brand owners with the points mentioning long term solution to present the crisis.
In the meeting, few partners expressed that if brand doesn’t take the memorandum seriously then the channel fraternity should unite by taking necessary action and thereby putting a break on further purchases of that particular brand. They also expressed that, they don’t understand why the brands incline towards online sellers when 80% market share is with traditional shop sellers. We give the best possible support to walk-in customer in the store giving them live experience. We also open boxes of laptops and show them the models, colours and other features spending lot of time explaining and satisfying them to take the best model. Giving them service and support year long is again a big challenge for offline sellers. Inspite of our hard work we don’t understand why the brand supports online sellers, said the partner with a serious note.
Another partner said in the meeting that month on month we fight with ourselves to complete the target given by brands to get the target benefits, but in recent few months we have been running shops without customers, so it becomes difficult for us to take the incentives and thereby affecting the incomes to meet the monthly expenditure. We have exclusive brand stores, as well as multi-brand stores since long time and from years we have taken lot of pain to push the brands by giving a stand to them. So, definitely brands should support us atleast with similar price what they are selling to online sellers, As other than price and convenience there is no such advantage to the customer buying online. We are not against the online business as its a convenience but just because of brands support to the online sellers on price factor we loose lot of business, said the partner.
Brands should also inform such offerings in online in advance to the offline partners so that they get prepared for the challenge coming in. We get things to our notice in the last moment and all the stocks gets stucked up, finally leading to a financial mess, said the partner.
As an owner of a brand and engagement with contractually committed B&M business partners, it is prime responsibility of brands to provide positive and healthy business environment to their business partners. After lengthy discussions with FAIITA members, having substantial business stakes in retail, it was 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, furthermore it is imperative to discuss, agree and implement the following:
- 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.
- 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.
- 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.
- 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.
- 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.
- 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 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.
- All the price parity compensatory claims to be settled by Brand Owners within one week .
- 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.
- 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.
- 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.
- 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.
Big Brands HP, Dell, Lenovo, Acer, Asus attended the meeting and promised to positively consider the tabled FAIITA Memorandum, also confirmed their responses accordingly on or before Wednesday, i.e November 28th 2018. Unanimously it was felt that all major Brands are with FAIITA and shall officially submit acceptance on or before promised date.
Heads of Following IT Associations and Firms attended the meeting:
Champak Raj Gurjaar, President FAIITA
Alok Gupta National Convenor, FAIITA
Gaurang Vyas, Regional VP West, FAIITA
Arun Kumar Dey, Regional VP East, FAIITA
Deepak Bommisetty, Regional Jt. Secy South, FAIITA
Navin Gupta Regional Jt. Secy. East, FAIITA
Sanjeev Walia Regional Jt. Secy. North, FAIITA
A.Singh, FAIITA State Champion Delhi and Owner, Computer Land, Delhi
Sushil Kumar, President, Jharkhand Computer Dealers Association (JCTDA), Jharkand
Gurpreet Singh, Life Time Chairman, PACT, Punjab
Rohit Kohli, President, UPCDA, Uttar Pradesh
Devesh Rastogi, Owner, Devlok Distributors and Member UPCDA
Krishna, Odisha
Sujay K Vijayan, President , Confed ITA TN & Puducherry
Parthesh Mathew, Gen. Secy., Confed ITA TN & Puduchery
Natarajan, Tamil Nadu
Shanmugasundaram, Tamil Nadu
Shrivallabh Sardessai, President, GIBA, Goa
Vinayak Nayak, Treasurer, GIBA, Goa
Trideep Chandra Talukdar President NECTA Guwahati
B.L. Navlakha, VP, NECTA, Guwahati
Mitesh Dave, FITAG, Gujarat
Praful Desai, FITAG, Gujarat
Amit, FITAG, Gujarat
Sanjay Jain, MCDA, Jabalpur
Praveen Jain, MCDA, Jabalpur
Manish Goyal, MPCTA, Indore
Manish Gupta, MPCTA, Indore
Lalit Gandhi, Nagpur IT Association, Nagpur
TAIT Representatives, Mumbai
Heads of following brands attended the meeting:
Dinesen Kochiparambath, National Sales Manager, HP
Nikunj Murukutla, Sr.Director, CSB, DELL EMC
Chandan, Suyesh , Dipetesh & Team, Lenovo
Chandrahas Panigrahi, Chief Marketing Officer & Consumer Business Head, Acer
Pramod Sharma, Retail Head, Acer
Arnold, Business Development Manager-PC & Gaming, Asus
Jignesh Bhavsar, ALP Manager,PC Business, Systems Business Group, Asus
The Office bearers felicitated all attendees to this meeting who took time from their busy schedule flying from various parts of the country for a common cause. Also, FAIITA thanked TAIT for their support to organise the event.