Ground Report | New Delhi: Ambani’s company Jiomart; Vipresh Shah, who supplies general household items, has not been able to sell a single drop of Detal soap to vendors in the last eight days. These are the same shopkeepers who have been buying such things from them for the last 14 years.
At Vita, near Sangli in Maharashtra, about 320 km from Mumbai, Vipresh Shah is a certified distributor of the UK-based Racket Banking Company. He told Reuters that even his most loyal customers are now stopping buying from him because these shopkeepers are now using the JioMart Partner app.
Vaprish says that when you go to the shops to sell goods, the shopkeepers show you the JioMart app on which the prices are reduced by 15%. He says that the shopkeepers say to him in a sarcastic tone, “You have robbed us a lot.” “I am a racket distributor in the area and once had a monopoly on the market,” says Vaprish. Vipresh Shah says that he has to spend around Rs. But they will not be able to do so consistently.
Ambani’s company Jiomart
Jiomart is an app by Mukesh Ambani’s company Reliance Industries, Asia’s richest man, through which they want to “revolutionize” India’s retail sector. There are thousands of small villages and towns like Vita in Maharashtra, India, where small retailers are now turning to Jiomart to buy wholesale goods. These small retailers own most of India’s 900 900 billion retail markets today.
Mukesh Ambani is now doing the same thing in the retail sector as he did in the telecom sector through Jio Mart. Through Jiomart, it is competing with US companies like Amazon and Walmart and is rapidly gaining ground in India.
How did this commotion take place?
There are about 600,000 villages in India. They have about four lakh distributors for wholesale supply. So far, these wholesalers are selling goods to retailers at a profit of three to five percent. This trade is done on a personal level. The retailers either carry the goods themselves or the wholesalers deliver the goods to their shops.
But Reliance’s model has caused a “commotion” in the system. Retailers book RDR from their store on the JioMart app and get the goods to them within 24 hours. Reliance also trains vendors on how to book orders. It also provides facilities such as borrowing and getting samples for free.
The loss of Reliance’s move is being borne by millions of small distributors and salesmen of multinational companies like Racket, Unilever, Colgate-Palmolive. Conversations with dozens of salesmen, distributors, and a trader’s group led to the conclusion that their entire business was in trouble.
They said that since the advent of the app, the business has shrunk by 20 to 25 percent, due to which a large number of people have lost their jobs and even sold cars.
Vipresh Shah, a distributor in Vita, says he had eight employees, four of whom he has fired, and he fears that his family business, which has been going on for the past 50 years, will continue for the next six months.