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Vision 2021: Enabling E-Commerce For Holistic & Inclusive Growth
E-commerce emerged as the point of convergence for both consumers and sellers by reviving demand and effectively meeting the gap between demand and supply.
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World over, the Covid-19 pandemic has caused huge economic disruption and hence prompted businesses to evolve in the wake of new realities of social distancing and prioritising safety. This disruption has led millions of people to turn to ecommerce to shop for essentials while staying at home. The transition had a quick and wide-scale uptake, among both consumers and sellers owing to convenience, expanded access and last-mile connectivity.
India was no exception. In India, MSMEs (Micro, Small and Medium Enterprises) and other small businesses were the most adversely impacted in this pandemic. While ordering a nationwide lockdown to safeguard lives, the Government of India exempted several services including the delivery of essential goods by e-commerce, bearing in mind the needs and safety of the citizens. While e-commerce could operate, there were obviously many on-ground challenges, including disruption in supply chains, movements of delivery executives, availability of supply lines, etc.
As the country adapted to the ‘new normal’, scenarios of demand and supply were extremely dynamic. On the demand side, categories of products such as office stationery, school supplies, routers, mobiles, etc. that did not form part of essentials at the beginning of the lockdown, emerged as ‘essentials. On the supply side, MSMEs faced limited liquidity, production challenges, piled-up inventory and closed warehouses.
In this evolving situation, e-commerce emerged as the point of convergence for both consumers and sellers by reviving demand and effectively meeting the gap between demand and supply. MSMEs were quick to realise the potential and make the shift to digital commerce towards operational revival. These businesses found support on onboarding, cataloguing, marketing, account management, working capital support, business insights and warehousing.
They also found like-minded partners in e-commerce who enabled them to pivot their business models. In return, capability and infrastructure for local manufacturing- generating employment saw a boost, keeping the economic growth engine active.
There is no doubt that 2020 accelerated e-commerce adoption and revolutionised the way sellers operate their businesses and how consumers shop. In 2021, we take forward learnings from the past year, which taught us that technology adoption and digitisation of retail are the way forward.
The demographic profile of online consumers is expanding and evolving drastically. From Gen Z to baby boomers, many consumers, including those in tier 2 and tier 3 cities, are now shopping online. As consumer buying patterns shift, the e-commerce industry is well-positioned to cater to this growing. With India emerging as one of the world’s largest internet markets and the change in consumer preferences pivoting towards online shopping, there lies a huge growth opportunity.
The time is ripe for MSMEs to utilise e-commerce for business growth. It is also in line with the government’s vision for a technologically advanced and innovative retail ecosystem rooted with the backbone of indigenous production and manufacturing. Sectors enabling government policies to promote indigenous manufacturing and external factors such as the advent of 5G connectivity will provide further impetus to this growth. The government and industry should continue to work collaboratively to create a robust ecosystem that can propel economic activity and build an ‘Aatmanirbhar Bharat’. This will also give a fillip to trade inclusion opportunities for small businesses and handicraftsmen. Efforts should also be intensified to enable MSMEs to get online by reducing their compliance burden and supporting their financing needs by making growth and working capital available for the small businesses.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.