The crisis in its top India leadership team is ballooning into a major problem for Reebok India.
In what could bring the entire supply chain for Reebok India to a halt, accumulating payments due from the company to franchisees and a stop in the issuance of fresh stock is leading to high uncertainty about the future of the sportswear firm among channel partners.
Sources told
To manage the crisis brewing at the ground level, newly appointed Group sales head for India, Mr Frederic Serrant, is meeting the 34 distributors across the country. His mandate will be to soothe the nerves of the essential distributor partners, while chalking out a plan to pay existing dues.
“They should have had a consultation with us before announcing such elaborate plans through the media,” said one of the biggest Reebok distributors for North India, who has about Rs 20 crore due to him from franchisees.
To an email query on the same, a Reebok-appointed spokesperson said that the company would not like to comment.
Unsure about their future, franchisees are also holding back payments to distributors, who in return are not supplying fresh stock, even from existing inventories.
Additionally, some outlets claim to have not received payments from the company itself as part of their minimum guarantee contract.