Mobile phone retailers had threatened to go to the CCI against Xiaomi, accusing the company of favouring online marketplaces over offline retailers
Chinese smartphone maker Xiaomi has hit back at mobile retailers in India, refuting allegations that the company broke agreements by striking exclusive deals with online marketplaces. Mobile phone retailers under the All India Mobile Retailers Association (AIMRA) had threatened to go to the Competition Commission of India (CCI) against Xiaomi, accusing the company of favouring online marketplaces over offline retailers.
“Sir, Xiaomi’s claims of the highest sales in the last two months has put us all in contemplation as to from which channel has such a huge sale been achieved. Whether it is done by exporters, aggregators or some other channel because Mi partners across India have got the least stock or no stock during that period," the letter, addressed to Sunil Baby, Xiaomi’s Director of offline sales, said.
Mobile phone retailers have accused brands like Xiaomi of short-changing them in favour of their own online stores or Amazon in the past as well. The AIMRA had made demands for parity between online and offline channels in January 2020 as well, and has been vocal about the issue for years.
In response, a letter signed by Baby to AIMRA claimed that the allegations are “factually incorrect" and called it an “attempt to defame" the Chinese brand. “Over the years, we have made substantial investments in our Retail channel and with the love and support of our Mi Fans and Partners has delivered stellar growth for all of us. As per GFK, our offline retail market share has increased by 5% absolute increase since the start of 2021, which could not have happened without improved supplies and endless support and trust by our partners in our brand," the letter from Xiaomi, which was seen by Mint, states.
The company also said that it does not sell any online exclusive mobile phones in India and doesn’t differentiate in terms of pricing in online and retail channels. It also claimed that both retail and online channels have been hit by supply constraints caused by the covid-19 pandemic.
“We strongly disapprove the incorrect statements being made by AIMRA," the company added. “We believe that associations such as AIMRA and companies like us should work together to empower the retail partners and grow their business, especially during such trying times. In such a situation, mutual trust and collaboration become extremely critical ingredients for success," it said.
Xiaomi has been leading the Indian smartphone market for over two years now. According to a July 28 report by market research firm Counterpoint Research, the company and its subsidiary POCO own 28% of India’s smartphone market at the moment. In fact, four of the top five smartphone brands in India are of Chinese origin, barring Samsung, which trails Xiaomi in the second position.