Aavin has warned retailers, dealers and wholesalers against selling its milk above the maximum retail price (MRP). The milk major had recently hiked the margins for these delivery agents following the increase in procurement and selling prices.
After a gap of 10 years, the margin has been increased from ₹1.50 to ₹2 per litre where the retailer would get ₹1.50 and the rest would be shared by the dealers and wholesalers.
This hike, which had been a long-time demand of Aavin’s channel partners, came into effect from September 1.
“We will not hesitate to take legal action if shops sell above MRP. Action would also be initiated against the wholesaler and distributors if they are taking more margin than they ought to, which causes retailers to sell over the fixed MRP. We will also take action against our own staff if they are found guilty,” Aavin Managing Director C. Kamaraj said.
However, consumers said that Aavin milk in many places are sold at least ₹1 over the MRP. Some shops in Velachery, Pattabiram, Choolaimedu and Thoraipakkam, did sell milk at least ₹1 over the cover price. “There is an increase of another rupee during summer since shops have to shell out for increased power bills to keep the milk from curdling,” said V. Anuradha, a resident of Pammal.
S.A. Ponnusamy, Tamil Nadu Milk Dealers Employees Welfare Association, said the increase in margin provided by Aavin was insufficient. “Wholesalers get 70 paise as transport allowance, but we don’t. Dealers have to supply milk to retailers and also make collections in the evenings. Private brands provide ₹5 per litre to dealers and retailers, which is why you don’t find retailers selling private milk over the MRP,” he said.
Selling above the MRP is a violation of rules and action should be initiated by the Labour Department and also by Aavin, said T. Sadagopan, president, Tamil Nadu Progressive Consumer Centre.