FMCG distributors’ body seeks CCI investigation against quick commerce platforms

MUMBAI: The All India Consumer Products Distributors Federation (AICPDF) which represents scores of small retail businesses has petitioned India’s fair trade regulator, seeking an investigation into the anti-competitive practices of quick commerce platformsSwiggy Instamart, Zepto and Zomato’s Blinkit. In its petition to the Competition Commission of India (CCI) submitted on February 28, AICPDF alleged that the platforms are resorting to deep discounting and predatory pricing, pushing small retailers out of business. Their conduct, the industry body, said “appears to eliminate” competitors from the market. TOI has reviewed parts of the petition. AICPDF confirmed submission of the petition but declined to share details. Zepto and Swiggy Instamart did not comment while Zomato did not respond.The industry body alleged that the platforms have deep pockets and are “indulging in deliberate losses by way of predatory pricing” to expand in the market. They alleged that the small retailers and traditional distributors are not able to match the discounts offered by the platforms, thereby taking a business hit and sinking in losses. In certain cases, to lure new customers, AICPDF alleged that the quick commerce platforms dole out introductory offers in addition to the discounts, which often are in the nature of predatory pricing.AICPDF has been fighting against the quick commerce platforms, having sent a letter to the CCI in October through the ministry of commerce. This time, however, they have directly filed a petition with the CCI. Quick commerce or 10-minute delivery platforms which initially started out selling groceries have rapidly expanded especially in the metros where people are often pressed for time and have moved beyond kitchen staples to sell a range of non-grocery items including small appliances, mobile phones, electronics, jewellery and apparel.For brands which have found a new avenue of distribution with quick commerce, they are more than willing to test the rapid delivery model and continue partnership with the platforms as long as they are being able to reach more customers.A survey by market research firm Datum Intelligence late last year covering 3,000 respondents across 10 cities had shown that about 82 per cent of buyers have moved at least 25 per cent of kirana purchases to quick commerce. Investor appetite for quick commerce has surged amid wide consumer adoption with Zepto bagging $1.2 billion in funding last year in an otherwise tepid market. The company is planning to file for public listing this year.AICPDF said that quick commerce is “wiping out millions of retail shops and distributors from the market.”Offline retailers across segments who have already been hit by the advent of online commerce are up against rapid delivery platforms. Already, the National Restaurant Association of India (NRAI) is pursuing a separate legal case against 10-minute food delivery service offering private labelled food by Zomato and Swiggy.