Honasa denies distributors’ association's claims of unsold stock, says secondary dues have been cleared

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Subscribe to enjoy similar stories. Honasa Consumer, the parent to personal care brand Mamaearth, has denied allegations made by the All India Consumer Products Distributors Federation (AICPDF) regarding unsold stocks causing financial burden on distributors and retailers, noting that the figures mentioned by the industry body is “inconsistent" with the sales driven through the channel.

“We have actively and transparently addressed our transition (under Project Neev) to a direct distribution model during our results for Q2FY25. Significant progress has been made to remove stocks worth ₹63 crore from our distribution system as part of transition away from super stockists.

All secondary claims from active distributors have been cleared up till August and the rest are in final stages," the company said in a statement on Tuesday evening. The AICPDF on Tuesday claimed that several distributors and retailers are facing an “alarming crisis" of unsold stocks nearing expiry, resulting in an estimated financial burden to the tune of ₹300 crore.

“Adding to the crisis, credit notes worth more than approximately ₹50 crore remain unsettled, creating severe cash flow challenges and threatening the stability of the entire distribution network," the body said in a statement. This comes nearly four months after Mint reported that the body raised similar concerns of excessive inventory that the company had dispatched to the market, and delays in replacing damaged, unsold and expired stock.

In an interview with Mint the following month, Honasa’s Alagh said that the company is working on bringing down the inventory holding period from 90 to 40 days with a distribution strategy shift titled ‘Project Neev’. Mamaearth’s distribution strategy