Way forward for Small businesses – Ecommerce Economy

Imagine setting up a small business a decade ago, from a small rural town. There was no large scale mobile internet .There was no social media like Instagram, Twitter or even broadcasting/communication apps like Whatsapp. Wifi was available sparingly as the world was switching from a slow dial-up connection to a 2MBPs wifi connection. Your small scale business remained small scale even after years. There was no way to promote it to the outside world (without heavy investments and TV ads). Your small scale business reach ended within your town. But the Ecommerce economy boom changed things

Ecommerce economy

Roll back to 2022 and we now have sellers from the distant corners of the country selling exquisite things to a person sitting in the other corner of the country. Be it a homemade Garam Masala powder or a handcrafted diary, you could effortlessly sell in E-commerce sites like Flipkart.

Primary Difficulties faced by Small Business

  • Creating awareness of their product to people living in other states and cities
  • Logistics Cost : A large part of packing & shipping is borne by seller hence resulting in minor losses
  • Lesser Margins : As a small business selling to local communities, the margins were forced to be kept very low
  • Marketing cost : Selling through their own site costed a lot in terns of marketing & promotions
  • Product Returns : Buyers had no protection guarantee and hence hesitated to buy from small businesses.
  • Economies of Scale : With lower margins and less sales units, achieving break even took several years (sometimes, never)

Ecommerce Economy – Paving Roadmap for Small businesses

The only way to scale to a national level was to sell through e-commerce. Setting up their own direct selling website was a way However the technical know how wasn’t available freely and they always ran into many issues.

However Ecommerce sites like Flipkart, on the other hand, completely changed the game for small businesses , especially in the last 4-5 years. The Ecommerce economy boom played in their favour. Ecommerce companies took care of the marketing, logistics, handling, payments .Only the product listing part was left for the seller to do.

Ecommerce economy

From 5 orders a month, sellers easily scaled to 5000 orders a month with hardly any effort from them. WIth a good quality product in hand, many small businesses was able to sell several thousand units at a highly profitable margin and at the same time keep their operating costs at a low.

The rise of the Entrepreneurship & Ecommercy Economy

Unlike large cities or metros, people in small cities primarily had to rely on Government jobs or poorly paid unskilled labour. The dream of setting up their own business wasn’t possible for all. This was due to the heavy investment barrier and other bureaucratic red tapism that acted like a hurdle. With recent laws to help startups and with Ecommerce companies giving a lending hand, this has propelled our economy further

Even people with a low paying full time job, have discovered the benefits of reselling / selling through Ecommerce sites. The additional income sometimes gets converted to a full time role, if they find the right audience.

A delivery to every corner

With their own robust logistics channel, major Ecommerce giants like Flipkart has enabled fast and safe shipping methods to reach the product in just a matter of days . In fact my last order in Flipkart was an unique designer cell phone case. The delivery all the way from a little unknown town in West Bengal. I just realized the reach ,Flipkart had given to that seller , to enable him to ship his product to the other corner of the country!

Written as part of Blogchatter’s campaign #ECommerceBuildsEconomy

Leave a Reply

Your email address will not be published.