e-Tailing market is growing at a CAGR of 63%

Oct 07, 2016: Finally, the biggest online shopping sale has come to an end. A week-long sale of the three of the biggest e-tailers (Amazon, Flipkart and Snapdeal) witnessed great response from consumers. Indian e-Commerce market has seen a rapid growth in past few years. More than 70 percent of the e-Commerce market is travel related. The e-Tailing market has grown from $0.64 billion in 2013 to $4.6 billion in 2015 growing at a CAGR of 63 percent. The remaining comprises e-Tailing (online retailing), online financing and classifieds. Increasing internet and mobile penetration, growing acceptability of online payments and favourable demographics has provided the e-commerce sector in India the unique opportunity to companies connect with their customers. The unprecedented rise in the e-Tailing market led to rise in demand of e-Commerce Logistics. According to ‘Indian e-Commerce Logistics Market Overview’, the customer base for e-Tailers was not just restricted to the metros. Almost half of the orders were from Tier 2 and Tier 3 cities. Generally, all the logistics service providers have a great reach and give timely deliveries in metros but, with this expanding customer base, timely delivery to such regions became a necessity. Logistics isn’t just an issue for bigger players but it is a bigger issue for smaller and upcoming start-ups. Finding a perfect logistics partner with a great reach across the country, COD facility and timely remittance and all this at a lesser price became one of the primary objectives for all the e-Tailers. A delay in delivery just adds to the dismay of the customer. The report also mentioned that there would be over a five to seven-fold increase in revenue generated through e-commerce as compared to last year with all branded apparel, accessories, jewellery, gifts, footwear are available at a cheaper rates and delivered at the doorstep. Out of eight e-Commerce unicorns from India, three are e-Tailers (Flipkart, Snapdeal, Shopclues). The big e-Tailers like Flipkart, Amazon, Jabong, and FirstCry went for developing in-house Captive Logistics arm example Ekart of Flipkart, Amazon’s Amazon Transportation Services Pvt. Ltd., GoJavas of Jabong, XpressBees of FirstCry etc. Many start-ups have entered into the logistics market in past few years offering e-Commerce focused logistics solution, Delhivery, Ecom Express and GoJavas, to name a few. The traditional the logistics service providers like Blue Dart, FedEx, Gati, India Post, Safexpress etc. have also come up with their e-Commerce focused logistics solutions. In coming years this market is going to rise as with the increase in the e-Tailing market aided by internet and Smartphone penetration in India, and to cease the opportunity many new players will enter the market with their offerings for e-Tailers.