There was mixed reaction from the dealers in helmets to the action initiated by the Labour Department on Friday against those selling helmets at exorbitant prices over and above the maximum retail price (MRP) and without MRP indication.
A dealer in Arni Road said that most dealers were forced to sell the helmets at prices above the MRP since the distributors in Chennai sold the helmets at the MRP to the dealers who had no other go but to sell them at prices above the MRP in order to make profit.
A distributor in Bengaluru sold the helmets at prices ranging from 20-30% above the MRP, while many distributors in Chennai sold them at 5 to 15% above the MRP to the retailers. “How can we sell at the MRP when the distributor does not give us any discount on the MRP,”asked a dealer. He said that the companies do not entertain any queries on supply. They direct the retail dealers to the distributors who do not provide any discount. Besides, the dealers have to incur additional expenses on transporting the helmets.
The dealer said that he had pay transportation charges at the rate of Rs.50 to Rs.70 per helmet since the transporters in Bengaluru levy charges based on the space occupied by the helmets. In the case of the transporters in Chennai, the transportation charges worked out to 5 to 6% per helmet. “I can make a 4% profit only if I go to Mysuru and place orders with the distributors there”, he said.
A dealer in Katpadi Road here said that he was able to make a marginal profit in sale of branded helmets at the MRP since he was able to get a discount from the distributors in Chennai.
My margin is reduced because of the transportation charges, he said. The complaints from helmet buyers were only against those dealers who sold unbranded helmets at exorbitant prices. Cashing in on the sudden demand for helmets in view of its being made mandatory from July 1, a few dealers sold helmets at Rs.1200 which were worth only Rs.300, he said.
No stocks
Many shops selling helmets in Vellore reported 'no stocks’ on Saturday owing to the exhausting of the stocks following the heavy demand in the last four days. Quite a few of them did not place fresh orders for helmets in view of the raids and the non-viability of selling the products at MRP. They wanted the government to intervene in the matter and regulate not only the retailers but also the distributors.
Distributors provide the helmets without any discount to them, say retailers
