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Traders body Confederation of All India Traders (CAIT) has reached out to the Ministry of Commerce asking them to measures against the ecommerce portals that are practicing predatory pricing to attract more customer during this Diwali season.
In a memorandum addressed to Nirmala Sitharaman, minister for Commerce and Industry, they raised the concern stating that in order to attract more customers these marketplaces are circumventing the law and engaging directly with the end-users which is prohibited for them, and therefore the ministry should take steps ensuring fair trade practice.
“It is apprehended that the losses are being funded either by these portals or by other financial institution with its motives. Such exercise is predatory pricing which is prohibited in the country,” said in a statement.
The matter of contention is that the ecommerce giants like Flipkart, Myntra, Snapdeal do not call themselves as stock inventories, but rather call themselves technology platform and an online marketplace, facilitating buyers and sellers. But the word marketplace it still vague and ambiguous.
The trader body has also requested for an investigation to understand how these marketplaces are able to reduce the prices of the products selling it a much lower rates than the stores.
However, this is not the first that the body has reached to the ministry seeking help against the so-claimed domination played by the ecommerce portals. Last year also, it had approached the ministry with this concern.
In order to counter the rising popularity of ecommerce marketplace, in June this year, the body announced to launch their ecommerce platform, eLala. with an aim to aid the small retailers, this portal would have all the products on competitive prices and the consumers will have the option to get it delivered at home, or can visit the offline store to make final transaction.
CAIT is a collection of 2000 trade federations and associations, representing more than six crore retailers.
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