Offline retailers refuse to sell Lenovo smartphones

| Writankar Mukherjee | ET Bureau | Mar 8, 2016, 14:53 IST

A large section of brick-and-mortar consumer electronics retailer... Read More

KOLKATA: A large section of brick-and-mortar consumer electronics retailers in India have stopped selling Lenovo smartphones, protesting against the huge discounts and better models that the country’s third-largest smartphone maker allegedly offers online.

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Neighbourhood mobile phone stores and electronics chains in major markets, including Mumbai, New Delhi, Kolkata, Pune, Nagpur, Hyderabad, Bengaluru and Bhubaneswar, have together decided to take this step. Even large and national retail chains have agreed not to stock Lenovo smartphones, three senior industry executives said.

“We have raised the issue with Lenovo and decided not to sell or push their models till they decide on uniform trade terms. This is unhealthy competition,” said a senior executive with the All India Mobile Retailers Association.

The retailers also want matters such as expensive spare parts and poor after-sales service resolved. Lenovo India declined to comment for this story. Lenovo wants to build the offline business for its smartphones, India managing director Rahul Agarwal told ET recently. He had said e-commerce contributes 75% of smartphone sales for Lenovo India and the company wants the share of offline trade to touch about 40%.

Industry executives said this once again sparks the war between offline and online retail in India, which has forced brands to develop uniform pricing strategies for both channels. A couple of years ago, Lenovo had opposed online discounting in India, a strategy that it now appears to have adopted. A senior AIMRA official said Lenovo recently offered a handset with different names and prices for online and offline channels, with the online model cheaper by Rs 2,000.

“They have also realised that if they want to gain share they have to focus on the Rs 15,000-plus segment, which sells mostly through offline trade. So we expect the company would soon come up with a strategy for offline trade too,” said the CEO of a leading mobile phone retail chain. The Lenovo-Motorola combine had an 11.4% share in India’s smartphone market, behind leader

Samsung Electronics

and Micromax Informatics, in October-December and also had become the second-largest 4G smartphone brand, according to Counterpoint Technology Market Research.

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Top Comment

miten mahapatra

3131 days ago

There is lot of confusion in the minds of Indian consumer and let me try to help with the best of my abilities being a Lawyer myself. The manufacturers now a days specifically in India are encouraging sells through online model. It gives them immense profit and less liabilities. I will explain why ---- If they sell their products offline then they will have to keep their Retailers happy will have to ensure their profits, after the profits Retails also want to keep their customer base intact so the Manufactures are bound by the after sales service and it''s best of the quality which the customers are facing today having crappy after sales service of all the cellphones. NOW LET ME TELL ALL WHAT THE LAW OF THE LAND SAYS AND HOW MANUFACTURES AND THE ONLINE SELLERS ARE TAKING BENIFIT OF THE SAME. The law says that the liability of warranty comes and knocks the doors of the Manufacturer only when the Manufacturer or it''s Authorized Distributor/ who is also authorized to sell to the customer, or Authorized Retailer, or Authorized Reseller are only the authorized entities who can sell the products of the Manufacturer as they are only certified by the Manufacturer to do so. So the Manufacturer is at liberty either to give after sales services to you or to altogether deny the same to you at their sweet wish and you are not protected by the Guarantees as is told to you.These Companies also charge exorbitant sums for repair of their products when you approach a service centre and for maximum of times you feel cheated and feel that its better to purchase than to repair a old product. Online companies also cash in to this defect as they cannot be dragged before the appropriate Court by you not being a Authorized distributor, Retailer or seller. So the ultimate looser is the Indian customer who falls for the cool features but fails to understand that the product which are sold online are first of all not of substantial quality as the Manufacturers know that they cannot be dragged to Courts for failing to ensure quality of their products. You will be surprised to know that many manufactures have this clause in their agreements with a seller who might be authorized seller for few products but not a Authorized seller for online products that they cannot sell their products off line because first of all these products are not having high quality and doesnot want to be dragged to Courts for the same. Indian people fall for specification and not think much for quality so the net result is the Manufacturers and the Online sellers are winning and the final suffering entity is the end consumer.

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Offline retailers refuse to sell Lenovo smartphones

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