After raising red flag over Flipkart’s Big Billion Day sale, traders body CAIT today said it will convene a meeting after Diwali with FMCG companies to discuss their concerns and product pricing.
“This is a serious issue which is adversely affecting the offline market to a great extent and therefore we have decided to hold direct talks with all such companies on this complex issue to understand as to how the online retailers are able to sell at a much lower price,” CAIT Secretary General Praveen Khandelwal said in a statement.
Confederation of All India Traders (CAIT) had earlier called for a probe in the business model and trade practices of e-commerce companies to find out how they are offering huge discounts during the ongoing festive season.
“Gauging the seriousness of the issue which has shocked the offline market all over the country, CAIT has decided to convene the meeting,” it added.
About 50 companies, including LG, Samsung, Sony, Philips, Reebok, Puma, HP, Titan, Casio, and Guess have been invited, it said, adding that a White Paper will also be prepared from the discussion which would be submitted to the Commerce and Industry Minister.
“There is an estimated loss of business in various segments from 20 per cent to 35 per cent in various segments in last six months and if the present trend continues, it is apprehended that the offline market will suffer a loss of about 50 per cent business by the end of Diwali festival,” it said.
There are apprehensions that either there is underpricing by the e-commerce firms or influx of material from grey market or some sort of funding to sustain losses, it added.