HUL - JioMart Tie-Up Stirs Disruption In B2B Distribution: Systematix
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Systematix Research Report
Hindustan Unilever Ltd.’s commercial relationship with Reliance JioMart business-to-business new commerce for the sales and distribution of the company’s products on a pan-India basis has met with stiff opposition from distributors.
The partnership enables JioMart to distribute HUL's products to B2B customers (kirana stores, hotels, restaurants and cafe) and compete directly with the traditional distributor network.
The All India Consumer Products Distributors Federation expressed its dissatisfaction with the tie-up through an open letter to all fast moving consumer goods companies, followed by a protest on August 28, 2021.
Our channel checks indicate that the main issue is the differential pricing offered to JioMart (5-7% lower as compared to distributors), allowing it to undercut prices and win retailers’ loyalty.
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