22nd Edition
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Yashobhoomi, Dwarka
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New Delhi


31 May 2022

Manufacturers in fix as customers demand discount

Manufacturers in fix as customers demand discount

Ludhiana: Engineering products manufacturers of the city are in a soup due to the decrease in the rates of steel.

In an unusual problem, citing decline in the steel rates, their customers are now demanding discount in the rates of the finished products. But manufacturers are not decreasing rates of their products stating they did not increase rates in the same proportion as the rise in the steel rates and they have been absorbing the majority of hike. Rajkumar Singla, president of Fasteners Suppliers Association Ludhiana", said,

Due to the recent decisions taken by the central government, there has been decrease in the rates of steel raw material used by bicycle, fastener, auto parts, sewing machine and other sectors where steel is the primary raw material. Though as of now the maximum decrease of up to Rs 8,000 per tonne has taken place in different types of steel raw material, but our customers have started demanding decrease in the rates of end products immediately, which is not possible. For more than one year we have been absorbing majority of the hike in the rates of raw material — we never passed it on completely to our customers. The present decrease in the rates is sufficient only for us to break even or earn marginal profits and there is no scope of any reduction in rates of end products.”

According to Nitin Sharma, executive member of the Auto Parts Manufacturers Association , “Due to decrease in the rates of steel raw material we are facing very awkward situation as we on one side we are happy that finally the rates of raw material have started decreasing but on the other hand our existing business has started suffering. Majority of our customers have stopped placing new orders to us as they want discount on the existing rates which is not possible for us to give because the rates of steel have not declined to such an extent that we are in position to offer discounts,”


Source: https://timesofindia.indiatimes.com/city/ludhiana/manufacturers-in-fix-as-customers-demand-discount/articleshow/91904437.cms

This Post was originally published on  timesofindia.indiatimes.com