Price dumping issue – M MALAYSIA

Price dumping issue – M MALAYSIA

With an aim of achieving a total turnover of RM20 billion by the year 2020, Malaysia’s direct selling sales revenue for year 2018 has already hit RM15.9 billion.

 

Currently, Malaysia has a total of 441 direct selling companies which offer a huge variety of products ranging from electronic & electrical appliances to beauty & health products. Direct selling companies usually sell their products to the consumers at a standard retail price through their authorised agent / members with them earning from accumulative commissions per quota basis.

 

M Malaysia is an example of price dumping victim which caused damage in company loyalty amongst its members loses and also losses in revenue due to lack of trust and confidence towards products from consumers. Price dumping largely affects a brand and all its members when certain ‘unethical’ members sell the company products lower than the standard retail price to achieve the set quota for a certain commission/ reward. And this is an act of price dumping.

 

This created unfairness and imbalance towards the rest of the ethical members who are still selling products at the standard retail price. This group of ethical members will then lose out on both in achieving quota for the commission/ reward as well as the competition in sales due to the price differences. In the long run, this group of ethical members may begin to throw prices too in order to sell their products or worse, to quit the group.

 

Consumers will start to question or hesitate when buying the company’s products due to the varying prices especially with the growth of less regulated e-commerce sites. The rise of e-commerce has adversely affected the direct selling industry’s standing in terms of product pricing, authenticity, consumer protection, leaving consumers open to fraud and substandard products.

 

As the ‘unethical’ members would definitely need to keep their identity anonymous, after-sales care and services are deemed to be non existence. The product consumers will have no way of knowing expiry dates, product approvals and guaranteed cooling-off period that licensed direct sellers have to honour. This is another downfall from the consumers which will destroy a direct selling company as a result of price dumping.

 

However, M Malaysia have successfully caught its price dumping agents and largely reduced price dumping activities. After implementing our security stickers and QDots technology on their product packaging, M Malaysia has successfully caught more than 20 members who are dumping prices on its products. Through QDots itself, products which is being dump price are easily identified by checking the record of what products went through which agent.

 

Until today, more than 100 members have been identified for dumping prices and has been eliminated from M Malaysia. M Malaysia’s brand image and sales has rebound and now increasing with healthy figures and members.

Talk to our representatives about your situation and see how we can help you like how we helped M Malaysia.

 

Disclaimer: 

The name of the company has been changed to protect the interest, privacy and confidentiality of the company.

 

Reference:

https://issuu.com/harini.mservices/docs/direct_seller_malaysia_first_editio

https://www.kpdnhep.gov.my/status-of-direct-selling-companies/?lang=en