New Directions for Channel Business in Changing Times

As FAIITA President what new programmes have you started for the members?

When I took over as President, I realised that the manner of business needed to be changed to survive and grow in this domain. Only fighting with the online business wasn’t going to help us. Challenges are growing every day. Apart from the online system, LFR (Large Format Retail) is a bigger challenge since they buy in bulk. Hence, FAIITA has started IndiaITMall.com, which encourages members to sell in hybrid mode. We are trying hard to make it a success, but I feel it will a little more time to achieve its ends completely. 

Second, we are trying to connect them to new opportunities, so that the next generation which is not coming to this business, can come back.

Third, we have been trying to explain to the members that only box selling will not help them. They have to add to it service, customer satisfaction incentives as additional value. Reselling business will survive only if these extra values are added to it.

Fourth, we are supporting them to join and work on GeM.

How do you help the channel partners to resolve their problems?

We have good connection with the members. If they come to us, we help them with their requirement, which is a continuous process. If they need to sort out a problem with the vendor, we intercede and that is also a continuous process. It’s an everyday routine for us.

How have FAIITA member associations been doing I recent times, especially in the North, which has had a little different in work culture from the South?

The association in UP, which is called UPCDWA, is amongst the largest in India, with more than 800 members. The work culture in UP and in the most of North, is a little different. As compared to South, in UP the mode of operation is a little different. The associations are very strong in UP. In fact, when we were fighting against the online system, the UPCDWA took the lead.

Punjab is also very well organised. MP was not that well organised. But now we have 4 associations in MP. There’s one each in Jabalpur, Indore, Bhopal and in Gwalior. They are doing very well. Jharkhand association is also doing very well. COMPASS in Kolkata has expanded its reach. The association in Guwahati was earlier confined to Guwahati only. But now they have expanded across the North East. In Rajasthan we had one association in Jaipur. Now we have another one in Udaipur. In Himachal we have activated the association. They’re doing very well. In Chandigarh we activated an association. They’re also doing well. So we have covered a lot of ground.

Only in Telangana and Andhra the association is not strong. Haryana is a little weak. But in the rest of the North, I feel we have done a lot of work. Altogether now we have about 45000 indirect members.

How is your equation with the online system now evolving?

We have some parity programmes. Sometimes, especially during festive seasons they offer discounts for a few days. I don’t think either the vendors or the FAIITA will be able to stop that. If the customer gets a better price at doorstep in the comfort of home, then the only counter is that we offer the same price online with the same comfort of home.

If the cost of onboarding Amazon or Flipkart is 5-7%, at IndiaITMall it’s NIL. But still, bringing the entire channel network online is very difficult. Ut we have not lost hope. We are going to have a gathering in November. There the main focus will be the IndiaITMall. We are also negotiating with the ONDC.

The government has to take note of the way business is happening online, because there is a lot of information hidden in online sales. Only when the customer gets the final invoice with the product, do they know from whom they have bought. Earlier the government had taken note of our points about online. They have to continue with this process of monitoring the online system.

How do you see the channel business evolving in the next few years? Especially as OEMs are also directly connecting with the end users?

OEMs have to sell their products. That is their main goal. But the channel is a showcase for them. Hence, the channel business is here to stay. Brad stores where customers can see the products are going to survive. There’s no doubt about that. But their business is ultimately going to be a regulated business. They can’t make fortunes over there. That is the reason we always encourage FAIITA members to go for the Make in India products.

Make in India needs a lot of resources, R&D investment etc.

I have got my own brand. It doesn’t require much effort. If they go for an assembly line production, not much R&D investment is required for that. They can avail of the government schemes of Make in India related funds, MSME funding, startup funding etc.

Is Make in India actually good for the partners?

Make in India is very good. In sometime you will see that the channels will deal more with the Make in India products. They have better margins, less complications, less number of managers to deal with. So it will be helpful for the channels to work with the Make in India products.

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