NEW DELHI: If you're looking to buy a OnePlus phone in Andhra Pradesh, Telangana, Tamil Nadu, Karnataka, Maharashtra, or Gujarat after May 1, 2024, you might be out of luck. The South Indian Organised Retailers Association (ORA), representing 23 major retail chains in six states, have announced they will stop selling OnePlus devices from next month. In a letter to Ranjeet Singh, director of sales at OnePlus India, ORA has cited narrow profit margins and delays in claim processing as key reasons for the decision.
“Despite our persistent efforts to address these concerns with your company, little progress or resolution has been achieved. Promises made have not been fulfilled, leaving us with no recourse but to take this drastic measure… ORA painfully wishes to inform our collective decision to halt the retail of OnePlus products in our establishments from 1st May, 2024,” reads the letter.
ORA represents major retail chains such as Poorvika, Sangeetha, Big C, and Pooja and the organisation’s decision could be a big blow to OnePlus. But what exactly caused this situation? Let's delve into the reasons behind the ORA's move.
What is the reason?
According to ORA, the registered association of the organised retail chains in India, the core issue is profitability. ORA members claim the profit margins offered by OnePlus on their phones are too low. With rising operational and financial costs, retailers struggle to make a sustainable profit selling these devices. Another major concern for ORA is the lengthy and complex process for handling warranty claims and repairs on OnePlus devices. Delays in resolving these issues frustrate customers and create extra work for retailers who have to deal with customer dissatisfaction. The association also mentioned the alleged practice of mandatory bundling. It means that OnePlus requires retailers to sell other products like cases or screen protectors alongside their phones. Furthermore, some stores claim pressure to stock specific OnePlus models that don't sell well. This can lead to a build-up of unsold inventory, further straining retailer finances.
Communication gap
The ORA letter emphasises that these issues haven’t been resolved despite attempts to address them with OnePlus. This suggests a breakdown in communication or a lack of willingness from OnePlus to find a mutually beneficial solution.
The impact
This move by ORA could significantly impact OnePlus sales in a crucial region. Losing access to major retail chains means fewer potential customers for OnePlus phones. This could force OnePlus to re-evaluate their pricing strategy, warranty processes, and collaboration with retailers in the region.
In the meantime, customers in the affected states will have to explore alternative options for purchasing OnePlus phones or look to other brands altogether. According to Counterpoint Research, OnePlus grew by 33% year-on-year in 2023 driven by offline expansion and better product portfolio in the affordable premium segment (Rs 30,000- 45,000).