Kolhapur resellers demand action against cross territory business

Concerned over the increasing incidents of cross territory business and price undercutting, local resellers in Kolhapur said that such anti-channel activities were a major threat to local businesses. Resellers demanded vendors’ intervention to stop cross territory business and give local resellers and distributors an equal chance of survival.

Shrenik Bindage, who runs Purvaja Infotech, said that cross territory business practices has been adversely affecting local resellers. “Distributors and resellers from Mumbai and Pune come to Kolhapur and dump their products. As the LBT has abolished now, all are free to do business anywhere in the state. However, the local business is disturbed due to entry of outsiders.”

Amar Mangave, one of the prominent distributors and owner of Aditya Peripherals said vendors’ intervention was very critical to safeguard the interest of local dealers.

“Vendors want business and therefore, they bill large amount of goods to certain dealers. These dealers penetrate into other regions as they need to meet their targets. In order to achieve the numbers, they even do not hesitate to undercut the price. Customers always prefer to buy products at a cheaper rate and these outsiders get the benefit of price undercutting.”

Mangave said that there was a need for a collective action against vendors who encourage such business practices. “I boycotted two prominent vendors in printers due to their anti-dealer policies. Vendors need to work upon their relationship management and exercise control over dealers who undercut prices to get more business”, he said.

IT stands for around 150-200 Cr industry with close to 350 active IT dealers in Kolhapur. Government, Agriculture, Telecom etc. are some of the prominent verticals here.

Another reseller on the condition of anonymity, claimed that these distributors were backed by vendors who wanted to retain in the competition. “If only certain selected people are going to get benefit of bulk purchasing and freedom of doing business anywhere, then there is no logic behind having a local distribution chain”, he said.

Bindage said that all dealers in Kolhapur were needed to come together and raise voice for their rights and compel vendors to take an action against the unethical business practices.