Reckitt Benckiser India has started to incentivise its distributors and retailers by giving them Amazon and Flipkart vouchers on completing sales targets, which was earlier given in cash. Some of its distributors have protested the move.
Photograph: Francis Mascarenhas/Reuters
Fast-moving consumer goods companies typically incentivise the supply chain with cash on meeting their sales targets.
The company has also changed the ‘return of damaged goods’ policy with its distributors.
Earlier, the goods could be returned without any specific time frame. However, this has now to be done within six months.
Reckitt, the maker of Dettol soaps, has sent a ‘cease and desist’ order to some distributors affiliated with the Tamil Nadu Consumer Products Distributors Association.
In the order, it stated that the distributors have spread a false campaign against the company and its officers.
Business Standard has accessed the cease and desist order.
It states: “This action has inflicted significant harm upon our Client’s reputation, resulting in a substantial loss of goodwill.”
“As a consumer welfare association, you were fully aware that your statements would be detrimental to Reckitt India and its reputation.
“Consequently, you are liable to Reckitt for defamation by slander and/or libel under Section 499 of the Indian Penal Code, 1860, as your defamatory remarks have caused injury to Reckitt India’s reputation,” the order said.
It also said that failure to comply with the company’s demand will leave it with no choice but to pursue all available legal remedies, including but not limited to seeking restraint orders, damages and criminal action, for the harm caused to its business.
Emails sent to Reckitt Benckiser India last week did not elicit a response till press time.
All India Consumer Products Distributors’ Federation (AICPDF), a representative body of distributors, in a statement told Business Standard that these notices have been issued in response to some of its distributors protesting against the alleged unfair practices.
It also said: “AICPDF has been vocal about raising concerns regarding the business practices of Reckitt Benckiser India, which they argue are detrimental to the interests of small distributors and traders.”
