Distributors upset by FMCG cos’ practices

The issues were discussed at a national governing council meet of the All India Consumer Products Distributors’ Federation (AICPDF) in New Delhi earlier this month. Representatives of 17 state associations attended the meeting. The AICPDF represents lakhs of distributors pan-India.

“All the state leaders gave detailed presentations of the issues faced by their members which they feel should be taken up by AICPDF with the concerned company management. Issues such as problems faced by distributors due to billing on company billing software, unjustified area bifurcations done by company executives, infringement of rights of distributors by online companies were discussed,” said Dhairyashil Patil, pesident, AICPDF.

Many state representatives requested AICPDF to look into the concerns of the distributors of FMCG companies like Cadbury’s (Mondelez), Amul and Tata Consumer Products who suffer due to the anti-distributor policies of these companies, the association members said in a note.

AICPDF has resolved to take up these issues directly with company management in due course.

Patil said that overall consumer has remained weak and issues with companies could further hurt small-scale distributors. As per data shared by NielsenIQ, FMCG volumes declined 0.9% year-on-year in the September quarter, as high inflation impacted consumer demand.

“In Mondelez, the stock we want is sometimes not available; then, there is dumping in the market, apart from this, they also want distributors to push stock in retail stores or small eateries that do not have the requisite FSSAI licence,” Patil said. A Mondelez spokesperson did not respond to queries.

Meanwhile, dairy cooperative Amul, which has been struggling with supplies of butter pan-India, said the situation is improving. On Tuesday, R.S. Sodhi, managing director of Gujarat Cooperative Milk Marketing Federation Ltd said the disruption was temporary. “There was some supply issues around butter near Diwali, those have been resolved,” Sodhi said.

Patil said issues have been more pronounced in the last 5-6 months. “These issues are now being reported in every state, especially with the three companies. With Tatas, distributors have been merged and there is some issue with lack of policy. Sales are down, dumping done on distributors and forcing distributor to sell,” he said.

A Tata Consumer Products spokesperson declined to comment on the issue. While these issues were discussed at the NGC meet, Patil said the association will reach out to the companies individually.