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Business News/ News / India/  MP's FMCG distributors call for mass resignation after HUL network expansion ad

FMCG distributors in Madhya Pradesh have called for mass resignations against Hindustan Unilever Limited (HUL)'s expansion of the distribution network in the state. Though the firm said it is not removing anyone of its current distributors and value relationships with them.

If new distributors are appointed, the the existing distributors of HUL fear to lose half of their investments in retail trade, their umbrella body AICPDF in a statement on 28 August.

Earlier in the day, HUL put advertisements for the appointment of new distributors for its brands in all major cities in Madhya Pradesh.

The leading FMCG manufacturer has invited people willing to invest up to 1-3 crore and can arrange a godown with required infrastructure.

ALSO READ: HUL to invest 700 crore in UP detergent unit by 2025

According to the All India Consumer Products Distributors Federation (AICPDF), because of the said advertisement, HUL's existing dealers are in 'sudden panic' and is viewed as 'immature and betrayal'.

"HUL Distribution Business warrants crores of investments particularly in Extending Credit facilities to Retail Traders for Sustaining and Growing HUL Businesses at risk. If New Distributors are proposed to be appointed, all Existing Distributors will lose a minimum 50% of their investments with Retail Trade," AICPDF said.

However, issuing a statement, HUL said: "The advertisement relates to expanding our work with General Trade distributors and is not about removing our current distributors."

"We believe the prospects for general trade business are bright in the region and are looking to partner with distributors to leverage opportunities. We conduct our business fairly and transparently, and our associations with our distributors are bilateral. We value these relationships and will continue to engage with them directly," said a company spokesperson.

In a similar case, AICPDF in December 2021 called for the boycott of certain products of HUL in Maharashtra, over issues of the price disparity between the traditional distributors and organised business-to-business channels.

But in January, it suspended the boycott after talks with the company. The AICPDF claims to represent over 4 lakh distributors and the stockist pan India.

With PTI inputs.

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Updated: 28 Aug 2022, 10:49 PM IST
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