Up to 5,000 Tata Consumer Products (TCPL) wholesalers in Kerala watched a symbolic strike Thursday against the company’s decision to terminate some dealerships.
The All Kerala Distributors Association organized the protest, claiming that TCPL-affiliated companies like KDHP, Tata Salt and Tata Coffee have unilaterally discontinued the service of around 67 distributors who have been in business for more than 40 years. The reason cited by the association is that these traders protested against TCPL in order to reduce the commission on the sale.
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The Kerala Chamber of Commerce and Kerala Vyapari Vyavasayi Ekopana Samithy also supported the strike.
AKDCA district president KK Rafeeque said many of Tata’s consumer products are selling like hotcakes in the Kerala market and the company enjoys a comfortable market share. TCPL has made no sincere efforts to resolve the crisis, especially when traders have stopped shipping Tata products since April 10, he added.
Meanwhile, TCPL said in a statement that after integrating the business of Tata Chemicals Foods and Tata Global Beverages into Tata Consumer Products (TCPL), the company sought to revamp its existing distribution network across the country, including Kerala, as part of its integration in a common system.
These changes began in September 2020 and have now been completed across the country except in Kerala, where this is currently underway. The proposed changes are in line with the way most FMCG companies operate and will benefit from greater reach and dissemination and the creation of more overall job opportunities in Kerala, it said.
TCPL has had extensive discussions with almost all distributors in Kerala over the past few months. These revised terms were very much appreciated by most of the distributors and include delivering larger business through the integrated TCPL portfolio, assistance with improving infrastructure, assistance with digitizing systems, faster handling of claims, etc.
These terms and conditions have been accepted and successfully implemented by over 5,000 distributors across the country, including in Kerala, where the majority of distributors have operated under these new terms and conditions in recent months, TCPL said. However, a minority of distributors tried to create the wrong image that TCPL was unfair and resorted to reducing the terms and conditions without consulting them.
“They insisted that they would continue to operate as before, in a way that was unsustainable as the terms and conditions must be mutually acceptable for the parties to do business. Only those minorities of sales partners who were unwilling to agree to the revised terms were given notice of termination and alternatives were appointed, ”it continues.