OnePlus faces boycott from mobile retailers due to narrow margins, delay in processing claims, ET Retail

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New Delhi: Mobile retailers have announced the discontinuation of products of smartphone major OnePlus effective May 1, 2024, due to unresolved issues regarding narrow margins and claim processing delays, the South Indian Organised Retailers Association (ORA) said in a letter on April 10 to Ranjeet Singh, director of sales, OnePlus India.

ORA represents 23 big chain retailers such as Poorvika, Sangeetha, Big C, and Pooja across Andhra Pradesh, Telangana, Tamil Nadu, Karnataka, Maharashtra, and Gujarat.

“As esteemed partners, we had hoped for a more fruitful collaboration with OnePlus. Regrettably, the ongoing issues have left us with no alternative but to discontinue the sale of your products in our stores. ORA painfully wishes to inform our collective decision to halt the retail of OnePlus products in our establishments from 1st May, 2024,” the letter read.

ETRetail has seen a copy of the letter.

According to the letter, retailers said that the consistently low profit margins on OnePlus products have made it challenging to sustain businesses, particularly amid rising operational and financial costs.

Talking to ETRetail, Sridhar TS, president of ORA said that OnePlus currently offers a margin of 5 per cent to retailers against an industry standard of 17 – 18 per cent.

Retailers said in the letter that model-specific bundling requirements by OnePlus have forced them to carry non-moving products, adversely affecting the margins and leading to unsustainable losses for the businesses.

Further, the letter read that retailers have been facing continued delays and complications in processing warranty and service claims from OnePlus.

The claims, pending from the last 5-6 months, amount to over Rs 8 – 10 crore, shared people aware of the matter.

Sridhar in the letter stated that despite persistent efforts to address the concerns, little progress or resolution has been achieved. “Promises made have not been fulfilled, leaving us with no recourse but to take this drastic measure,” he said.

Commenting on the issue, Navneet Pathak, National Joint General Secretary, AIMRA said, “Due to unethical business practices of OnePlus, chain stores of India have been left with no other resort to take this decision.”