FMCG companies assure price parity to distributors

NEW DELHI: Consumer goods giants ITC, HUL, Marico, Dabur, Haldiram’s and Nestle have met distributors in India and assured them of bringing parity of price, pack size and offers between products being supplied to general trade (kirana stores) and modern sales channels, such as, large departmental store chains and e-commerce.
During a meeting with representatives from the distributor community, senior Marico executives said 80% of its portfolio has been reserved for kirana stores, 15% for both and 5% high-value items are solely for large departmental stores and e-commerce, according to Dhairyashil Patil, national president of the All India Consumer Products Distributors Federation (AICPDF).
Around 4 lakh distributors across India had threatened to de-stock FMCG products in November, alleging discrimination by consumer goods companies between general trade and modern trade/e-commerce platforms. Distributors are used by companies to push their products to more than 1 crore wholesalers and retailers in the $700-billion domestic retail market.
“Large packs, 4kg and 6kg of detergent powder, are being reserved for modern trade and only 1kg packs are given to us. Why would a customer come to us four times a month when he or she can buy a 4kg pack for the whole month? Similarly, even for the most popular brand of coconut hair oil, modern trade is being supplied larger packs by the company,” said a distributor of large FMCG brands.