Kirana stores buy from Amazon & Flipkart festive sales, sell at market rates

Rural shop_SKB

The series of festive sales across e-commerce websites have given way to a new class of buyers comprising local shops and kirana stores who stock up the discounted goods to sell them at market price later.

As per a report in the Economic Times, shop-owners have created multiple accounts on the e-commerce sites in order to evade the cap on units of the same product a user can buy and limit on the cashback one person can avail from the offers.

Such transaction amounts to over 20 percent of total online sales of smartphones and FMCG goods.

The local shop-owners have resorted to this method as, in many cases, the products offered by online retail sites are priced lower than the wholesale prices which distributors have to shell out.

Some of the popular smartphone brands such as iPhone, Redmi, Motorola, Oppo, among others are available at significant discounts on Amazon and Flipkart, or with cashback offers on Paytm Mall.

Also being bought are large-volume bundled packages of FMCG products such as soap, snacks, detergent, sanitary pads, sauces etc. which are offered at a highly discounted price online, especially under festive sales ahead of Diwali, the report mentions.

Mayank Shah, marketing head of the major biscuit manufacturer Parle Products, told Economic Times that “A parallel distribution channel” was being formed and it was disrupting the distributor-retailer trade channels. He also warned it could become a disruptive factor in the long run.