A group of small online sellers have knocked on the doors of India’s competition watchdog to restrict large sellers from getting preferential treatment in Flipkart’s annual Big Billion Day (BBD) festival. The group, which is been represented by All India Online Vendors Association (AIOVA), has lodged its compliant in a written letter to the Competition Commission of India (CCI).
A reputed business daily has accessed this letter, wherein small sellers have complained that Flipkart offers preferential treatment to some of the large sellers by slashing their advertising and logistic fees. In case of small sellers, they have to earn these preferential treatments either by paying hefty sponsorship fees or consistently earning positive reviews/ratings.
AIOVA has alleged that while small sellers have to spend lot time and energy to earn these preferential treatments, Flipkart offers these preferential treatments literally on platter to some of the large sellers.
This is not the first time that small sellers have written to CCI about Flipkart’s encouragement to unfair competition. In the past, they have been equally forthcoming about this issue, even demanding that the government should set up a separate watchdog for the e-commerce sector. However, their efforts failed to yield major response from the government.
It is worth noting that several small seller associations have been vocally against Flipkart’s recent acquisition by Walmart. Confederation of All India Traders (CAIT), representing 70 million traders, has filed petition at NCLAT to appeal against CCI’s approval of the Walmart-Flipkart deal.
Analysts claim that Flipkart’s preferential treatment to large sellers is largely due to commercial pressures. The desperate pressure to boost BBD sales in order to keep Amazon at bay is equally responsible for Flipkart allegiance with large sellers, analysts add.
Success of Big Billion Day sales is critical for Flipkart’s Brand Equity
In the wake of Amazon’s unprecedented rise, Flipkart is mindful that BBD’s success has assumed huge importance to keep its brand equity intact in India’s e-commerce market. Besides, considering that this year’s BBD sale would be the first after Walmart acquisition, Flipkart may not want to leave any stone unturned to make it a huge success.
India’s largest online retailer has already forged an exclusive partnership with noted brands like Blaupunkt and Xiaomi. The company is hoping that this exclusive partnership will help in boosting the sales of durable products like smart phones, televisions etc.
Bengaluru based e-commerce behemoth is expecting 80% year-on-year increase in gross merchandise value (GMV) from this year’s BBD festival.
Flipkart’s BBD festival will be soon followed by Amazon’s Great Indian Sale festival. Both these highly anticipated online sales festivals are conducted during the Diwali season.
Flipkart as well as Amazon always try to leverage this annual sales festival to ramp up their GMV and thereby gain deeper footprint in India’s online shopping market.