Chinese e-commerce company Club Factory has now become a platform that also sells groceries to Indians. This comes as the Covid-19 pandemic has revived anti-China sentiment, leading to calls for boycotting its products and apps.
Club Factory has been accused of shipping cheap products to India directly from China after labelling them as gifts to evade customs duty. This prompted the government to tweak rules prohibiting ‘gifts’ or duty-free imports via courier as well as the postal service.
Following this, Club Factory adopted a marketplace model of operations that’s aligned with Indian laws. Presently, Indian sellers are listed on its site.
Since April, Club Factory sellers have been catering largely to the unbranded products category, offering fashion goods and accessories as well as rice, pulses, pasta and energy bars to meet increased consumer demand for staples.
“Club Factory is committed to the India market and the current situation allows us to empower local sellers in India by enabling them to sell essentials and other groceries,” a company spokesperson said.
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The low prices of Club Factory had made it popular among Indian consumers, making it one of the top 10 downloaded apps in the country, according to app tracking firm App Annie. However, the pricing disparity had made it difficult for Indian traders and third-party sellers on other e-commerce sites to compete with the Chinese company.
Traders had complained that several Chinese sites, including Club Factory, were importing a large number of products from China as ‘gifts’ and shipping them directly to customers.
Club Factory, however, is unsure about grocery as a permanent category on the site.
“In the long term, as more consumers would prefer to shop from home and based on the demand for these essentials, we will decide regarding selling groceries as a permanent category in the future. Currently, the demand for essential and grocery products is healthy and maintained,” added the spokesperson.