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Retail majors complain against e-tailer pricing as they foray into e-commerce

Major Indian retailers like Reliance Industries (RIL), Aditya Birla Group, ITC, and Future Group among others have sent letters to the Ministries of Finance & Commerce through the Retailers Association of India (RAI), complaining about the predatory pricing on e-commerce platforms, reports Business Standard.

Apparently, these retail majors have also sought clarity from the government regarding norms for the e-commerce segment. It seems the government is already working on these lines. Recently, the Reserve Bank of India (RBI) deputy governor HR Khan told The Times of India that RBI is working on setting guidelines for e-commerce transactions.

Offline retailers have been protesting against unrealistic discounts on e-commerce marketplaces like Flipkart, Snapdeal and Amazon India for some time now, but the protests really gained momentum post Flipkart’s Big Billion Day sale and Amazon’s Diwali Dhamaka Week.

Last month, some of the leading retail outlets in India, including Tata Group’s Croma, Future Group, Planet M, Next, Reliance Retail and Sangeetha Mobiles among others had reportedly refused to sell Android One handsets in protest of Google’s decision to initially launch the handsets through e-commerce platforms only.

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Kishore Biyani Amazon

Complain and expand online

What’s interesting though is that most of these retail giants either already have tie-ups with certain e-commerce platforms to sell their products or have floated their own online stores. Kishore Biyani’s Future Group had tied-up with Amazon to sell its products on the marketplace in October this year, barely a week after Biyani had accused online marketplaces of undercutting offline retailers by selling products below manufacturing costs to destroy competition. Future Group also operates the online store FutureBazaar.com and the direct selling platform Big Bazaar Direct.

Similarly, RIL’s retail arm Reliance Retail had recently launched an online grocery store called RelianceFreshDirect.com in Mumbai. It had also mentioned a wider plan to go enter the online space in its annual report. RIL now also owns the TV and online commerce company Homeshop18, after acquiring Network18 in May this year. While last month, Aditya Birla Group CEO Kumar Mangalam Birla had told Bloomberg that they were planning to enter the e-tailing space, which “reflects the new India, its new lifestyles, new spending patterns.” Aditya Birla Group owned Madura Fashion & Lifestyle had already launched an online store called TrendIn.com in March last year.

Also Read: Retailer asking e-commerce players to reign in discounts is hypocritical and anti-consumer

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