CONFED-ITA has met up for a Vendor Meet in Chennai recently to discuss the menace of e-commerce trading. The Meet was attended by Office Bearers and the Task Force Committee of CONFED-ITA, Satya Prasad, President – AIT and AnandRao Balluru, President – FITDAK (Federation of IT Dealers of Karnataka). The vendors present at the Meet were Samsung, Acer, K7 Computing, Lenovo, Canon, Dell, Toshiba, Asus, Epson and HP.
The President welcomed the gathering after briefing about the outcome of the 4th Confed EC Meeting & MAIT Strategy Meeting. He also gave a presentation on Online Portal trading and the consequences faced by channel with screen shot evidences.
Nalin Patel from AIT-Bengaluru though not present at the Meet has sent an email in consultation with the Kerala State office bearers which was shared in the meeting. The President informed the vendor Companies to share their views on the current scenario of e-commerce trading and they took turn to place before the gathering their individual initiatives they are taking to tackle the issue -
ACER - It is stated that Acer issued warnings and strict measures against those who indulge in unfair pricepractices to control online sales and confirmed that it doesn’t have any direct engagement with online portals. The company brought a practice of a day to day vigil on the online portals andreacted to those who are selling below MOP.
CANON: Canon stated thattheCamera and Printer segments have been deeply affected by online portals. There is a need of some regulation from the Govt side also. Canon does have direct engagement with online portal Flipkart with a clear price policy but not with Snapdeal that is under cutting the price of Canon products.
Notably by the next few days,Canon will come up with a clear online policy. Also there will be a policy on usage of Canon brands for online portals and pointed out in some foreign countries there is some 20% TAX for online sales.
LENOVO - Livelihood of vendor employees are dependent on channel business and Lenovoassured to support the channels always. In the interests of Channel, Lenovo is the first to say that online stores are not authorized to sell. Communication has already been sent strictly to Tier 2 & Tier 3 level of partners not to do business withOnline. Lenovo does not give any special pricing for online portals and has issued legal notices to erring partners. Traffic is important for online portals and thereby they are offeringat cheapest and subsidized pricesto increase consumer traffic. A request has also been placed byLenovo to have an Ombudsman within the association for vendors to come back with the specific names of partner who indulge in this.
DELL - As far as Dell is concerned, they have not engaged with any of the online store since they have their own stores. Considering the market scenario in the last few months, vendors are forced to go to online stores and engage with them particularly with Flipkart and Snapdeal. Dell billing price to any online store will be higher that the price billed to channel partners.
At this the President pointed out that there is a price difference of 5-10% from channel price comparing to Dell-owned online store. He asked whether a declaration can be given that online price will not be cheaper than the T3 price.Dell said it will revert on the declaration part.
TOSHIBA - There is no engagement with online portals and pointed out that a statement is alreadysentto consumers that the company is not authorizing any of the online portals. Customersalso called up Toshiba’s authorized centre and complained that they received product which is not the same as ordered one. As a policy, Toshiba will support Channels only and improve their business.
ASUS - Channels being the bridge to ASUS, it will support only them and monitor the pricing of online portals. If it is below MOP, they are issuing notices to the dealer. Also they are interested to take up the outcome of this meeting and its decision to the top level management of Asus for better transparency.
EPSON - Epson doesn’t authorize any of the online portals and 90% of business happens through Channels, remaining 10% happen through OEMS and other corporate business. Any issues in terms of online market place if brought to Epson will be sorted out.
SAMSUNG - Samsung pointed out that it does business through Channel partners only and not with any of theonline portals. It is the market place giving some discounts on products after sourcing from other vendors that disturbs the MOPof the Product.
K7 - K7 had informed online portals to stick to MOP. It is also concerned about the unethical practicesof channel partners that impact the sales of the channel eco-system. Warningletters are already prepared by the company.
The President noted that price disparity will be addresses and though online sales cannot be stopped immediately, he insistedvendors to authorize online seller so an erring partner canbe penalized.
In the end…
After every vendor has placed their individual thoughts, Confed-ITA concluded that a clear online policy should come upwithin 15 days from the vendors. A Draft on formation of an Ombudsman will be given by CONFED-ITA which will be a feasible solution with do’s and don’ts and a single point contact from vendors. If vendors are not ready for that, the association will not support them. Adraft of the same will be sent within a week.
Vendors pointed out that it is its own channel that is playing a role in cutting the price by selling through online portals. It has been decided that a declaration should be made by vendors stating that Vendor owned / Vendorrepresented Online portal price must not be lesser than T3 price.
samrita@varindia.com
