GOQii, refuting Flipkart's charges of products' pricing determined by resellers on the platform, said that it has a direct contract with the e-commerce company for e-retailing products instead of selling it through a third party seller.
Prominent fitness wearable technology company GOQii, refuting Flipkart’s charges of products’ pricing determined by resellers on the platform, said that it has a direct contract with the e-commerce company for e-retailing products instead of selling it through a third party seller. GOQii founder and CEO Vishal Gondal had last week accused Flipkart of selling its products at deep discounts.
“We have never dealt or negotiated with any third-party seller to sell our products on Flipkart. We have a direct contract with Flipkart. We are surprised that Flipkart is suddenly saying that it has no control over pricing and being done by third parties,” Gondal told Financial Express Online.
A Flipkart spokesperson said that the company is not commenting on the matter.
The company said that while Flipkart claims in their letter to the Department for Promotion of Industry and Internal Trade and Competition Commission of India that it is independent of products’ pricing but it has evidence, both on email and WhatsApp, to show that their employees are actively negotiating the pricing with GOQii and discussing discounts.
“Assuming that if there is an independent third party then how come we don’t know about it. Flipkart hasn’t mentioned the names of these sellers in the letter to DPIIT and CII,” said Gondal.
GOQii had sent a legal notice to Flipkart on May 18 for allegedly violating FDI e-commerce norms through heavy discounting on its products.
Gondal had last week tweeted about the heavy discounts offered on Flipkart.com for GOQii’s fitness bands HR and Vital that were available at 65 per cent and 71 per cent discounts on their costs of Rs 1,999 and Rs 3,499 respectively.
The company said that Flipkart’s pricing is lower than the products’ manufacturing cost.
“We are evaluating all are legal options. I don’t understand why Flipkart cannot stop the sale with deep discounts on our products when we have asked them to stop it and discuss this. People are assuming that they are not genuine products because of such low prices,” said Gondal.
The company claimed to have lost “a few 100,000 units at least” in corporate orders as its dealers and distributors, which are small businesses, selling to these corporates are getting order cancellations since they are asking for better pricing.
GOQii came across the steep discounting in the first week of May. Gondal further said that the response from Flipkart team or the CEO Kalyan Krishnamurthy is awaited by GOQii.
GOQii sells products through Cloudtail on Amazon in India.