From warehouses to local stores: Ola Electric shifts gear amid row

Amid the ongoing controversy in Maharashtra over Ola Electric stores operating without a trade certificate, sources at the Bengaluru-based electric two-wheeler manufacturer said the company is currently transitioning from a centralised warehouse model to a retail-focused approach. They emphasized that Ola Electric is ensuring all regulatory compliances are being met during this shift.

 

"Ola Electric now operates around 4,000 company-owned stores. As it gradually transitions its retail model from centralised warehouses to these stores, the company is ensuring all regulatory compliances are met in parallel,” a person aware of the development told Business Standard.

 

According to sources, Ola Electric is heading distribution network transformation projects such as shutting regional warehouses and shipping vehicles, spare parts and accessories from the factory directly to stores, automating registration and other processes, and productivity improvements in the sales and service network.

 

In addition to cost savings, these changes have resulted in reducing average vehicle inventory from 35 to 20 days, and reducing delivery time for customers from 12 days to 4 days.

 

Regional Transport offices in Maharashtra have been told to shut Ola Electric stores that are operating without a trade certificate.

 

Business Standard could not reach the state transport commissioner for a comment despite several attempts.

 

According to reports, the RTOs started inspecting Ola Electric stores from early March and found that several of these ‘experience centres’ were operating without a trade certificate, or sharing one among themselves.

 

Subsequently, on March 31, the Maharashtra Transport department served a notice to Ola to explain the lack of the crucial document.

 

“We have not received any such notice from the authorities. We urge you to refrain from publishing reports that are not substantiated by accurate facts and proper context. We continue to work closely with the concerned authorities in Maharashtra to address any specific queries or concerns swiftly,” an Ola Electric spokesperson said.

 

According to company sources, Ola Electric retails and registers its vehicles exclusively through its state-level distribution centers or warehouses, all of which are fully certified for trade. The company does not conduct sales through smaller outlets; vehicles displayed at these locations are already registered and kept there for delivery.

 

"As the company transitions its retail model from warehouses to stores, some confusion may arise. Ola Electric is proactively engaging with authorities to clarify any misunderstandings," said a person familiar with the matter, requesting anonymity.

 

Crackdowns on stores, however, continue in Maharashtra. More than 120 stores were found to operate without trade certificates, and of them 75 have been shut so far, reports claimed.