Multi-Level Marketing Companies issue notices to e-commerce sites including Snapdeal, Flipkart and eBay to stop selling their products
Amway, Tupperware and Oriflame have issued notices to e-commerce sites including Snapdeal, Flipkart and eBay, asking them to stop selling their products, reports the Times of India.
The merchandise of these three direct sellers is not only offered at discounts as high as 40% disturbing the direct-sales distributor model that these firms follow globally.
In the direct selling model, there are no sales through traditional retail outlets — companies hire distributors who, in turn, sell products to consumers. Most times, errant distributors themselves supply unsold stocks to e-commerce sites and the firms are working to identify and penalize them.
Chandan Dang, CMO, Tupperware told the Times of India “We have written to many of the e-commerce sites informing them about the disruption they are causing to our distributors and sales force and requested them to stop selling our products on their websites.”
According to the report online marketplace Snapdeal all vendors on its site are registered only after their applications are reviewed. A spokesperson for Snapdeal was quoted in the report as saying, “The decision on the pricing solely rests with the sellers.”
A spokesperson for Amway, which sells nutrition and beauty products, told the Times of India “Our code of conduct explicitly states that unauthorized Internet selling violates agreements with Amway and our rules department regularly monitors this activity to prevent prohibited selling. We have taken legal action in the past when these rules are violated and will continue to do so to protect customers and individual entrepreneurs – Amway business owners (ABOs).”
The firms have also written to the government through the Indian Direct Sellers Association (IDSA) to issue clear guidelines on this matter to protect the industry.