FMCG Distributors Prints businesses for clear guidelines to smooth GST transition

Mumbai: Distributors of fast moving consumer goods wrote to large FMCG businesses and asked to issue clear written guidelines and set up compensation mechanisms (such as credit notes, price protection or inventory adjustment plans) before the new rates for goods and services (GST) began on September 22. A letter issued by the All India Consumer Products Distributors Federation (AICPDF) reads: ‘Distributors are currently holding significant shares purchased at the Profession Rorm GST tariffs. Unless companies provide a clear mechanism for price adjustment, credit notes or compensation, distributors will suffer financial losses during the review of a revised interest rate, which can upset the improperness of the shares. Chain. “AICPDF represents more than 450,000 lakh distributors delivering more than 13 million Kirana stores across India. Short -term challenges The government’s decision to renovate GST will lead to sharp tax cuts on a variety of articles used daily. Hair oil, shampoo, toothpaste, toilet soap rods, toothbrushes and shaving creams will now cast 5%. butter, ghee, cheese, dairy distributions, prepackaged namkeens, bhujia and mixtures of 12% to 5%. -Rates have been purchased. Without a structured process of adjusting or compensating, retailers will face challenges to compete with new supplies at lower prices, “Aicpdf said. This could lead to stock, forced liquidation or even disputes between retailers, distributors and companies.” However, without a clear, uniform mechanism of trade channels, there is a risk of confusion and distrust in the consumer. FMCG enterprises should be transparent to communicate new MRP implementation time lines, billing adjustments and mechanisms for a smooth transition, so that consumers have experienced the actual benefit, “no favorit, please ‘AICPDF also sought uniformity in the implementation, so traditional trade was not harmed by delayed remuneration or Online and modern trading players have received preferential treatment. Distributors and retailers must have timely circulars, questions and training sessions on the management of pipeline stock under the revised GST structure, “said AICPDF. Mint reported earlier that some companies had already devised plans to switch to the new GST rates. Reduced taxes to reflect. Colgate-palmolive India Ltd, after the announcement of the GST, and the government’s decision to reduce the GST on oral care products from 18% to 5%.