Why mobile retail chains in India pull the plug on OnePlus gadgets?

Several mobile retail chains in six Indian states are set to cease the sale of OnePlus smartphones, tablets, and wearables from May 1, citing unresolved issues with the brand. This decision affects approximately 4,500 stores across Andhra Pradesh, Telangana, Tamil Nadu, Karnataka, Maharashtra, and Gujarat.

The South Indian Organised Retailers Association (ORA), representing 23 retail chains including Poorvika, Sangeetha, Big C, and Pooja, communicated their decision to discontinue OnePlus product sales in a letter addressed to OnePlus India's director of sales, Ranjeet Singh. The letter highlighted several issues, including narrow profit margins, delays in claim processing, and mandatory bundling requirements.

Sridhar TS, president of ORA, expressed disappointment in the ongoing challenges faced by retailers selling OnePlus products, which have ultimately led to this decision. These challenges, particularly low-profit margins amidst rising operational costs, have made it increasingly difficult for retailers to sustain their businesses.

Retailers also noted continued delays and complications in processing warranty and service claims, resulting in customer dissatisfaction. Additionally, they raised concerns about being compelled to bundle products or services with OnePlus devices, limiting their flexibility and leading to stagnant inventory and loss of sales.

Despite repeated attempts to address these concerns with OnePlus, little progress or resolution has been achieved, according to the retailers. The alleged diversion of products from e-commerce to retail channels without authorization further exacerbated the situation, disrupting fund rotation and denying the exchequer potential benefits from rotational GST.

Navneet Pathak, National Joint General Secretary at AIMRA, previously highlighted concerns regarding the distribution of products through e-commerce platforms, sidelining mainline channels.

As of now, OnePlus is yet to respond to queries regarding these issues raised by the retailers.

In summary, the decision to discontinue OnePlus product sales stems from a culmination of unresolved issues including low-profit margins, delays in claim processing, mandatory bundling requirements, and alleged unauthorized product diversion, leading retailers to take this drastic measure.