India will see rapid growth in e-commerce, m-commerce this year: Flipkart

Top Stories

»	49% Indian startups now from tier 2, 3 cities: Jitendra Singh
»	'India ranks 3rd in global startup ecosystem & number of unicorns'
»	Tripura exported over 9K tonnes of pineapples in 2 years
»	CPI inflation eases to 6.71% in July, IIP falls to 12.3%
»	Rupee depreciates 12 paise to close at 79.64 against US dollar

Saurabh Gupta | 12 Feb, 2015
The year 2015 will see a rapid growth of Indian e-commerce industry along with a dynamic shift in the Indian shopping behaviour; it will be the deciding year for Indian e-commerce, said Ankit Nagori, SVP - Marketplaces, Flipkart, in an exclusive e-mail interview to SME Times.

He said, "2015 will see large scale growth in the Indian e-commerce sector as we will see more people across the country participating in online shopping. This industry will continue to drive more employment opportunities and contribute towards creating more entrepreneurs through the e-commerce marketplace model. In fact, e-commerce will enable local artisans from all over India to revive and expand their businesses and be a part of this growing ecosystem."

Mobile commerce too will play a crucial role of bridging the gap between sellers and customers. People from the most remote parts of the country will be able to shop online through their mobiles - ably backed by superior supply chain facilities and payment options, he added.

Excerpts of the interview...

India has nearly 35 million small and medium scale Businesses (SMEs) most of which are not able to leverage the power of the internet because they lack the critical mass to attract customers online. How you see this big opportunity and the challenges involved?
Ankit Nagori: In the recent times, the e-commerce marketplace model has emerged as an extremely scalable model - especially for an emerging economy like India with such a huge population. This model helps entrepreneurs/ sellers to expand their businesses and explore new geographies. Our key focus has been to educate and enable local artisans and entrepreneurs to explore and adopt this model to grow and expand their businesses.

Currently, thousands of sellers are selling their products across categories on Flipkart. With more sellers adopting the online marketplace model, we are positive that artisans and manufacturers will be driving forces of this industry. The new found enthusiasm amongst the SME's and our efforts to enable them through our initiatives will definitely bring in a new wave of change in this sector. In fact, we are seeing an increase in the participation of SMEs from tier 2 and 3 cities since last years. Categories like handloom, handicrafts and local artifacts have emerged as prominent categories on our platform.

We are confident that online marketplaces are the future of e-commerce and artisans and manufacturers are the true growth drivers for this industry. We are working towards creating a marketplace ecosystem that makes it conducive for them to grow and develop - going from local to national players in their categories. We are positive that the share of sellers from smaller cities will increase as the ecosystem matures.

With regards to the challenges, maintaining quality of products and speed of delivery acts as the primary challenge. Our strict quality scanning process and superior supply chain support facilities enables us to ensure a smooth end-to-end shopping experience for every customer.

With supply-chain being one of our primary strengths, we have made our last-mile services mandatory for our sellers across the country. This ensures that we can speedily address any delivery bottlenecks our sellers may face, so that the order to delivery timelines is not hampered. In a lot of situations, our sellers are small artisans from tier 2 and tier 3 cities who may not even have the capacity to deliver across the country. Taking care of packaging, pick-up and delivery of their products also ensures that these artisans can continue to scale their business without having to worry about the logistics.

Another big concern is of course the quality of the items we list through our sellers. To ensure a set standard of quality of products, we have a strict seller screening process in place. It is mandatory for every seller to have a registered business and sell only original products with original warranties on Flipkart.

Any seller who has been blacklisted from other e-commerce portals in the past does not qualify to be a seller with us. We tend to take strict action against sellers who are found to be in violation of any law - for example selling fakes or illegal products.

Additionally, we have a great three tier seller rating/ review mechanism which helps us maintain the authenticity of the products that are sold on our platform. Customer rating, returns and seller cancellations are the key factors which determine a seller's rating. A seller with good customer ratings, less returns and cancellations immediately gets a better rating as compared to a seller with unhappy customer reviews and lot of returns and cancellations.

We also have on-ground teams carrying out quality checks at seller facilities from time to time along with mystery shoppers who are constantly monitoring sellers for product quality, delivery timelines and customer friendly return/replacement policies.

What steps are you taking to help SMEs create and expand their brands on your website?
Ankit Nagori: Flipkart has one of the largest sellers base in the country today with thousands of sellers selling products across categories. With the aim of encouraging and enabling SMEs, Flipkart has been working with various government bodies and associations like Federation of Indian Micro and Small & Medium Enterprises (FISME) and National Centre for Design & Product Development (NCDPD) to boost manufacturing in India. To step up the training facilities, Flipkart also signed a Memorandum of Understanding (MoU) with Director General - Employment & Training (DGET), National Institute of Fashion Technology (NIFT), Ministry of Labour and Employment, Govt of India last year.

To further enable SMEs to join this model and ensure the success of these artisans and entrepreneurs on the Flipkart marketplace, we have been working on several initiatives to build and strengthen the overall e-commerce ecosystem. Listed below are the key initiatives-

The Flipkart Kaarigar ke Dwaar initiative to boost local artisans and traders across India to explore the marketplace platform
Partnership with Government bodies like FISME, DGET, Ministry of Labour, Ministry of Textile, local weavers associations etc
Investments in building a technology platform for sellers along with improving logistics, payments, packaging, cataloging support
SME Training Program to train and support SME's to adopt the e-commerce platform. This initiative will provide training that encourage manufacturing and create future employment - which will lead to overall investment in Indian economy. These courses are directed towards the following entities -

1. SME Owners
2. SME Employees
3. Potential Entrepreneurs
4. eMarketplace Service Providers (Cataloging and Photo Shoot Providers)

Flipkart has been working with a few trusted investors/ partners to offer working capital assistance to the sellers since last year. With average loan value of Rs. 5 - 10 lakhs, high loan value up to Rs.50 lakhs is available for sellers. So far, this facility has helped hundreds of SMEs to expand and grow their business through the e-marketplace platform.

Last year, Flipkart partnered with government bodies like Federation of Indian Micro and Small and Medium Enterprises (FISME), Director General Employment and Training (DGFT) and National Institute of Fashion Technology (NIFT) to help Indian MSMEs leverage the online marketplace platform. So what is the development on this?
Ankit Nagori: As mentioned, the year 2014, saw several key tie ups with the government bodies. These associations aimed at catapulting India's manufacturing in rural and urban areas. Flipkart in association with FISME, Ministry of Labour, Ministry of Textile, DC Handlooms, DGET and NIFT has been working to educate, train and create employment for artisans and entrepreneurs in India.

Initiatives like these have helped Flipkart create a better and comfortable e-commerce marketplace ecosystem for sellers in India. These associations have resulted in increased awareness and active participation of SME's. In fact, SME's today are opening up towards exploring the online marketplace model. We have seen a huge surge in the number of seller registrations from non-metro cities.

This year, we plan to boost up these activities to connect with SME's in more clusters in India. There are several seller engagement plans, workshop sessions, marketing and financial support activities lined up for this sector. We want to enable sellers to expand and grow their business and being a part of the prestigious millionaire group. Additionally, helping these sellers create their own small brands is on our agenda too.

Flipkart aims to create 10,000 'millionaires' in 2015 through its e-commerce platform. Please give a brief idea about this aim.
Ankit Nagori: Today, 20% of our sellers do an average business of Rs.1 crore every month. Last year we saw over 2000 sellers become millionaires through Flipkart and we aim to have at least 10,000 sellers become millionaires this year through the sales generated on our platform. In fact, to encourage and enable sellers grow and expand their businesses, we are offering various initiatives/support like -
o   Workshops/sessions
o   SME training programs
o   Working capital assistance
o   Marketing support services like packaging, cataloguing to sellers
o   Investments in building a technology platform

Last we saw nearly 60 per cent of millionaire sellers coming from metros (Delhi, Mumbai and Bangalore) and the rest from the non-metros. In the year 2015 will see that the numbers from the latter will double. Categories like jewellery, home dÃ©cor & furnishing, large appliances and handloom & handicraft will transform into high performing categories and help drive more margins for the sellers.

Now you are selling your products under marketplace model too. How you see this move? With this model, how you assure satisfaction of the buyer? Also, are there any basic requirements to be a seller on Flipkart?
Ankit Nagori: Flipkart purely follows a marketplace model. Ours is a technology platform that enables thousands of sellers to reach out to a wider set of customers across geographies, thus helping them scale their business nationally.

To ensure a smooth shopping experience/customer satisfaction, we have few processes in place:
Seller background check before on-boarding
Standard quality check process for seller products
Packaging and cataloguing assistance to every sellers
Train and educate sellers based on customer feedback and ratings
Assist sellers with analytics to help them offer products based on customer requirements

Certain basic requirements that need to be fulfilled to become a part of Flipkart:

A primary requirement of becoming a seller on Flipkart is that the sellers should only sell original products with original warranties that are legally permissible in India
A seller who has been blacklisted from other e-commerce portal in the past, does not qualify to be a seller on our platform
The seller should have a registered business along with the mandatory documents like - PAN, VAT id, TIN, TAN etc
The products offered by the seller should be available on Flipkart as a category
The sellers pincode/location should be serviceable by our dedicated logistics partner - eKart
The seller should be capable of handling large scale orders from supply and packaging point of view too

According to you, what will be the next phase of eCommerce in India?
Ankit Nagori: 2015 will see large scale growth in the Indian e-commerce sector as we will see more people across the country participating in online shopping. This industry will continue to drive more employment opportunities and contribute towards creating more entrepreneurs through the e-commerce marketplace model. In fact, e-commerce will enable local artisans from all over India to revive and expand their businesses and be a part of this growing ecosystem.

Technology will be a key factor which will help us better online shopping experiences by improving customer service, after sales and supply chain support. Mobile commerce too will play a crucial role of bridging the gap between sellers and customers. People from the most remote parts of the country will be able to shop online through their mobiles - ably backed by superior supply chain facilities and payment options.

2015 will be a year which will see a rapid growth of this industry along with a dynamic shift in the Indian shopping behaviour - it will be the deciding year for Indian e-commerce.