Project Ginger, as Club Factory calls it, is asking vendors whose businesses have been impacted by the 21-day lockdown in India to procure goods from China. Club Factory in communications to sellers said it will facilitate the purchase, custom clearance, warehousing and shipment to end consumers.
“Club Factory is committed to rendering all possible assistance to the Indian government in dealing with the Covid-19 pandemic, including the supply of protective equipment,” a company spokesperson told ET. He added that the procurement of goods will be done “in compliance with applicable laws”.
However, sellers who had been contacted by the company to explore partnerships told ET that Club Factory associates were pitching the opportunity to them as a means of making financial gains during the lockdown.
“Continuous cash flow without your warehouse,” a communication from the company pitching Project Ginger to prospective vendors read. The communication said Club Factory was looking for partners with experience and capabilities in cross-border commerce, saying it wanted to empower sellers who have been affected by the virus outbreak.
While Club Factory told sellers it will source materials on their behalf from China and let them list these products on its India storefront, the company spokesperson clarified that sellers will be allowed to sell these products both offline and online. There is no restriction to sell exclusively on the Club Factory platform, the spokesperson said.
Club Factory has been hauled up in the past for flouting norms, with the customs department in Mumbai seizing hundreds of packages of the company last year. The company was found to be bringing goods into the country declaring them as business-to-business transactions when in fact the contents of those packages were individual orders placed by customers in India, which attract 42.08% duty.