7 Crore Local Kirana Stores Unite To Launch Ecommerce App; Will This Challenge Amazon, Reliance, Flipkart?

As the physical shops are shut following the lockdown to curb the spread of COVID-19 virus, customers are favouring online shopping. As the demand rose, Amazon roped in the local kirana stores in its new programme ‘Local Shops on Amazon’ and Google allowed free listing and selling in its Google Shopping Tab. Furthermore, Reliance Industries has also made the announcement of the JioMart-WhatsApp partnership to enable transactions between grocery stores and consumers.

Now the Department for Promotion of Industry and Internal Trade (DPIIT) and the Confederation of All India Traders (CAIT) have joined hands to develop a national e-commerce marketplace for local retailers and grocery stores.

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What is this Indian E-commerce Platform?

The trader’s body, CAIT, has already conducted pilots in various parts of the country though the government body, DPIIT is responsible for conception and designing of the portal through its Startup India wing. The pilots were carried out from the customer level to the retailer and up to the level of distributors. Apart from DPIIT and CAIT, the other promoters would be Startup India, Invest India, All India Consumer Products Distributors Federation and Avana Capital.

The e-commerce platform is expected to be launched in a phased manner from next week.

As per the reports, the Indian e-commerce platform is likely to onboard about 7 crore small traders in the country, including manufacturers, distributors, wholesalers, retailers of all verticals of domestic trade and consumers will be an integral part of this e-commerce platform.

CAIT said that the platform would be duly embedded with an efficient delivery ecosystem and digital payments. It will eventually be enlarged to all items being traded under domestic trade of India.

‘Startup India’, the agency under DPIIT has invited applications from all companies who specialise in IT solutions and logistical support solutions amongst others with a broader reach or network across the country to come forward and strengthen this delivery mechanism. Considering the ongoing global crisis and the number of increasing casualties to the crisis we are seeking readily deployable solutions.

Why a National E-commerce Marketplace?

In a statement, the CAIT said that to solve the challenge of providing essential goods to the Indian citizens during the COVID-19 crisis, DPIIT, which comes under the Ministry of Commerce and Industry, along with the traders’ body is synergising the efforts of various companies and startups working in supply chain to help the local ‘Kirana’ stores take orders online. This move is expected to ensure last mile contactless delivery through a national e-commerce marketplace.

The decision of a government national e-marketplace is expected to bring much convenience for the local grocery stores in Tier 2 or Tier 3 cities, where issues of connectivity and supply chain are prevalent. 

This initiative perceived by DPIIT and CAIT is a permanent one for digitising existing business of the entire trading community of India and not just restricted to the lockdown period.

CAIT Secretary General Praveen Khandelwal and CAIT have been critical of the e-commerce majors like Amazon and Flipkart for a long time mainly on the ‘deep discounting’ issue and have alleged the online giants made the trade uncompetitive for the offline traders.

Will this initiative by the Centre threaten the existence of e-commerce platforms like Amazon, Flipkart, BigBasket and others?