Companies

Reebok supply chain in crisis with no fresh stock issued

Roudra Bhattacharya New Delhi | Updated on March 13, 2018

BL10_01_REEBOKE

New India sales head meeting distributors for damage control

The crisis in its top India leadership team is ballooning into a major problem for Reebok India.

In what could bring the entire supply chain for Reebok India to a halt, accumulating payments due from the company to franchisees and a stop in the issuance of fresh stock is leading to high uncertainty about the future of the sportswear firm among channel partners.

Sources told Business Line that no fresh supply of apparel and footwear have been issued by parent Adidas Group since March 26. Meanwhile, payments running into crores of rupees are stuck in the spat between the company, distributors and franchisees.

To manage the crisis brewing at the ground level, newly appointed Group sales head for India, Mr Frederic Serrant, is meeting the 34 distributors across the country. His mandate will be to soothe the nerves of the essential distributor partners, while chalking out a plan to pay existing dues.

“They should have had a consultation with us before announcing such elaborate plans through the media,” said one of the biggest Reebok distributors for North India, who has about Rs 20 crore due to him from franchisees.

To an email query on the same, a Reebok-appointed spokesperson said that the company would not like to comment.

Unsure about their future, franchisees are also holding back payments to distributors, who in return are not supplying fresh stock, even from existing inventories.

Additionally, some outlets claim to have not received payments from the company itself as part of their minimum guarantee contract.

> roudra.b@thehindu.co.in

Published on May 09, 2012

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