The All India Consumer Products Distributors Federation (AICPDF), an apex body of distributors in the country, on Monday said Honasa Consumer, the parent company of Mamaearth, has been pushing “substantial volumes of unsold inventory” into general trade.
This move had resulted in distributors holding goods of 60 to 90 days, worth around Rs 100 crore, according to AICPDF national president Dhairyashil Patil.
The beauty and personal care company, when contacted, refuted the allegations, saying it is committed to fostering “long-term partnerships with its distributors”. “Honasa Consumer is dedicated to building distribution as a core strength for its business. We have been leveraging technology solutions for tracking inventory, sales, promotions to ensure transparent and efficient processes across the value chain,” the company said.
This is the second spat between Honasa Consumer and its distributors in a year. In 2023, ahead of the company’s initial public offering, AICPDF had said Honasa had distributed excess stock through its offline supply chain.
“Despite engagements with the company, it persists with its practices, causing distress among distributors. There has been unmanageable stock accumulation over the last three months. Also, there have been delays in replacement of damaged, unsold and expired stock. Over 2,000 distributors are affected by this issue,” Patil said, when contacted.
The
distributors’ body said it may have to take remedial action, including engagement with government bodies and holding orders from the company to clear excess inventory in trade channels.