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New Delhi: All India Mobile Retailers Association (AIMRA) has raised concerns about Xiaomi-owned smartphone brand POCO India’s business practices favouring e-commerce platforms and distribution of products through illegitimate channels, thus evading taxes.
In a letter addressed to Himanshu Tandon, Country Head, POCO India, the mobile retailers association said, “With continuous feedback and hue and cry from our retailers It has come to our attention that POCO’s strategy appears to favor exclusive online sales, a move that reeks of monopolistic and anti-competitive behaviour.”
AIMRA’s National Joint General Secretary, Navneet Pathak in the letter said that the association has escalated this issue along with its fellow associations ORA and CAIT to the Finance, Commerce Ministry, and CCI to investigate into POCO’s operations.
“It’s time to demand the cancellation of their trading license on continued anomalies and bypassing the law of land in India.”
ETRetail has seen a copy of the letter.
The letter stated that POCO favors exclusive online sales, and has established collusion with e-commerce platforms to distribute products through unauthorized channels, bypassing legitimate distributors and evading taxes.
Retailers said in a 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.
AIMRA along with its letter attached screenshots of POCO’s exclusive launches on e-commerce platform Flipkart and of aggregators in retail selling preactivated handsets. The supply of products to retailers through illegitimate channels encompasses situations where both aggregators and students buy in bulk using credit cards and distribute to retailers without proper documentation or legitimate invoices.
These unauthorized channels also handle activated stocks, endangering consumer safety and national security, while also disrupting cash flow and causing revenue losses to the exchequer, the letter added.
“Before resorting to further measures involving regulatory authorities, we invite you to engage in discussions with us to find a mutually beneficial solution. This presents an opportunity for POCO to enhance its reputation and expand its global reach,” AIMRA said concluding the letter.
As per IDC report, POCO holds about 5.7 per cent share and the 7th spot in the Indian smartphone market as of Q3 FY2023. AIMRA highlighted that POCO is the only brand working exclusively online to enjoy this market share.
POCO India has not responded to ETRetail’s query.
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