![]() | #2101 | |
Senior - BHPian Join Date: Sep 2008 Location: DL9C
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![]() | #2102 | |
Senior - BHPian Join Date: Dec 2008 Location: Bangalore
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As for the "Rs. 1000 crore fine", I would really like to know where this number came from - ED or the CNN-IBN reporter's imagination? | |
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![]() | #2103 |
BHPian Join Date: Aug 2007 Location: Bangalore
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| ![]() Moto 360 is available and Instock. If you are interested, head over to Flipkart - http://www.flipkart.com/motorola-mot...1=16CL1Xforums |
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![]() | #2104 |
BHPian ![]() Join Date: Oct 2009 Location: Delhi
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| ![]() I dont know about the legalities But selling items at a huge loss to gain market share, increase evaluations or as a marketing gimmick because you have a bunch of venture capitalists behind you isnt really fair. The govt needs to curb this to a certain extent. So I think the FK hungama is spot on. |
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![]() | #2105 |
Senior - BHPian ![]() Join Date: Aug 2006 Location: Bangalore
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![]() | #2106 |
BHPian ![]() Join Date: Oct 2009 Location: Delhi
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| ![]() Apologies. My bad. Not so good with all the departments involved. |
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![]() | #2107 | |
Senior - BHPian ![]() | ![]() Quote:
I may be wrong here but I think FK is not monopolizing anything and is not forcing anyone to buy a particular product from them. | |
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![]() | #2108 | |
Senior - BHPian Join Date: Dec 2008 Location: Bangalore
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Anyway, price undercutting is a legitimate practice in all spheres of business - nothing unfair about it. It is usually not sustainable, so the incumbents just out-wait the newcomer. They don't go screaming "Mummy!" to the government. :-) Is there anything stopping from the rest of the players from doing the same thing? CCI has a phrase, "abuse of dominant position". It will be a challenge to anyone who complaints against Flipkart to prove that they have a dominant position in any market. | |
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![]() | #2109 |
BANNED Join Date: Oct 2013 Location: bangalore
Posts: 560
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| ![]() I find it funny that some people, on one hand claim that the whole discount thing was an eyewash (that such items did not exist at all) and on the other hand claim that Flipkart is able to provide "discounts" since they got VC funds recently. First they have to decide whether the discounts were real or not. They can't claim it both ways. |
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![]() | #2110 |
BHPian ![]() Join Date: Oct 2009 Location: Delhi
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| ![]() The discounts were real. There may have been only a handful of products sold under each category but I have read online that people did get really good deals. All the others who couldnt score deals are probably doubting it like like what happened with the Mi3's. What the government does is a totally different ball game. Because its the government and digging into this topic will open a can of worms. And i dont think I have enough knowledge on that topic to talk about it. Again like I said, i don't know the legalities or the technicalities. Undercutting profits is a fair game. Totally acceptable. Selling products cheaper than what it cost the manufacturer is not. That's killing the competition. You make the other retailers bleed to death until you have the monopoly. Then before its too late, you sell out for a couple hundred billion. So even if you wrote off 20% of that in the form of 'discounts' you still make money at the end of the day. That's what I make of this. And I make be way off. And apologies for that. |
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![]() | #2111 | |
BANNED Join Date: Oct 2013 Location: bangalore
Posts: 560
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In the current case, it is hardly that what has happened. The discount was only for a limited quantity of items, just to attract traffic. They are not selling all Lumia 520s for 900 rupees all throughout the year. The discount lasted for just a few minutes for probably 100 pieces. That does not kill any competition. The offline retailers are just irked that Flipkart is eating into their profits. Seriously, I don't see the possibility of any online retailer killing any competition by organizing an one day discount sale. In fact, it is the offline retail giants that are trying to kill off new competition by complaining to the government. | |
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![]() | #2112 |
Senior - BHPian ![]() Join Date: Apr 2005 Location: AU
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| ![]() From what I can understand from the below link, the ED notice/case has nothing to do with the Big Billion Sale. It's related to FDI in Multibrand B2C retail. http://indianexpress.com/article/bus...r-fine-likely/ 1000 or 1400 Crore seems to be an imaginary number used to garner attention. On another note, if at all Competition Commission issues an notice to Flipkart, it'll be interesting to see the REAL numbers behind the Big Billion Sale. IF the sale was real (i.e lots of below cost price to a good number of people), they could end up with a fine for trying to misuse market position. IF they just sold couple of hundred products below cost, then there's a whole world of people waiting to tare them apart in the Social network not to mention that, they could still be tried for misleading public. Either ways, they are in the dock. Flipkart as a brand was doing very well. This whole discount fiasco was not needed. Probably they should have been careful with the parent FK brand and tested the discount sale with the Myntra brand. But then, any publicity is good. Look at the sheer number of coverage they got ![]() |
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![]() | #2113 | |
Senior - BHPian ![]() Join Date: Aug 2006 Location: Bangalore
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This year they secured investment. So far so good, but the business is very risky. There are plenty of instances of failures (like Indiaplaza), where when the VCs left, the company collapsed. | |
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![]() | #2114 | |||
Senior - BHPian Join Date: Dec 2008 Location: Bangalore
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The only case where a regulator gets involved is when you have a dominant position - that is, when you are the only one satisfying the demand for a large majority of the consumers. Quote:
So this is the old FDI violation case that has come to bite them now. Nothing to do with the Big Bang Billion Brawl. Phew. Last edited by binand : 14th October 2014 at 21:26. | |||
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![]() | #2115 | ||||
BHPian Join Date: Apr 2014 Location: Account closed
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Apart from (1) none of the others is likely to be true and understandably this issue is completely moot as reported in http://timesofindia.indiatimes.com/B...w/44765232.cms where the head of the CCI has made a statement that there is no scope for any investigation of Flipkart at the moment. If a seller is not attracting all these three conditions he can legitimately give away products for free without any restrictions. The ED notice to Flipkart is entirely different and arises due to a concern that Flipkart (through WS Retail) is engaged in multi brand retail funded by foreign investment which is not permitted. It has nothing to do with discounts or undercutting. Quote:
As a strategy I doubt giving hurtful discounts consistently makes much sense simply because most consumers are not very sticky when it comes to choosing the lowest price.Tomorrow if some other online or offline retailer (with a minimum delivery standard) offers the same product at less we will simply migrate there, much like economy airline tickets. However MRPs on products leave varying degrees of cushion for the seller and there is no reason why high margin products cannot be consistently sold at good discounts (>15%) without any adverse effect. I am, of course, unhappy I got nothing out of the Flipkart sale and many products had illusory discounts but that does not change my general confidence in Flipkart. I still trust them to display reasonable prices as opposed to mom-and-pop offline stores which might pass off a product at an outrageously high price with no hangups and who cannot digest the fact that a competition could even think of selling a product below an MRP, let alone do so regularly. I like their search function, I like the review feature, and I love the convenience of home delivery with COD. Unless they mess up my orders (cancellation, wrong product, delay) I am going to stick to them and am certainly thankful that they exist. As consumers, I cannot understand why some people are quick to call for FK's head just because a 40% discount was in reality a 10% discount -- that is a trick all sellers use and a little due diligence before purchasing would have given a fair idea. Last edited by Kumar R : 14th October 2014 at 23:19. | ||||
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