Increasing Scope of e-commerce business in India

Increasing Scope of e-commerce business in India

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In the past few decades, India has witnessed rapid globalization and the widening of its economy. Nowadays, the likes & dislikes of the consumers are normally driven by the quality aspect. If it comes to operate a hi-tech niche business in a well to do locality, it will usually imply a very huge outlay, just as you need to focus on various aspects such as maintenance, health & hygiene and sanitation of the premises and all that holds topmost priority in a general visitor’s standpoint. 

On the contrary, a different medium of business has emerged in today’s scenario and that is of the e-commerce business. This is indeed a kind of business channel that requires minimum outlay but gives returns later on.

1. Overview of e-commerce business in India:

There is no doubt that India is an enormous market with a sea of opportunities. In today’s digitalized era, various up to date new businesses have ventured into this market to tap the huge online audience.

The ever-growing e-commerce platform has largely transformed the way business used to be done earlier in India. Here are several startling facts in this regard-

• Indian e-commerce market had a record growth of US$ 38.5 billion as in 2017.

• The Indian e-commerce market is now anticipated to expand to US$ 200 billion until 2026. 

• In December 2018, the internet user base was 604.21 million.

• Now, the present trend of digital transformation in India is thus deemed to boost the total online user base to 829 million users till 2021. 

• The internet economy of India was valued at US$125 billion as of April 2017. 

• India’s web-based economy is now expected to experience double-fold growth to US$ 250 billion till April 2020. 

• Gross revenue from E-commerce in India was US$ 39 billion in the financial year 2017-18. 

• This total revenue from E-commerce in India is now anticipated to jump to nearly US$ 120 billion in FY 2020-21, 

• Currently, the internet economy of India is growing at the Compound annual growth rate of 51%, which is the highest in the world today.

2. What is the cause of such amazing growth of e-commerce in India?

There is no big surprise! The overwhelming growth of the e-commerce industry is attributed to the changing consumer trend. Very importantly, has been hugely triggered by rising internet and smartphone penetration.  So, the growth of the e-commerce business is majorly backed by technology. 

Hence, we see that there is a huge scope of e-commerce business in India, owing to the ever-increasing Market Size. However, there is some necessary compliance for entering e-commerce. An average trader must have a GST registration, along with MSME registration for doing e-commerce business. 

3. How much is the growth of the Client base on e-commerce in India?

As we discussed above, the Indian e-commerce market is increasing from US$ 38.5 billion in 2017 to US$ 200 billion by 2026. 

• This is actually pushed by rising Smartphone penetration, especially after the launch of 4G mobile networks, along with increasing consumer purchasing power. 

• Online sales in the retail sector in India are predicted to grow at a rate of 31%. This has already led to an amazing growth to US$ 32.70 billion during 2018. This growth trend was led by e-commerce operators like Flipkart, Amazon India, and Paytm Mall.

• Similarly, the growth in the food industry is also highly triggered by the e-commerce operators like Zomato, Swiggy and Food panda. However, one needs to have an FSSAI registration for doing business with such e-commerce operators.

• Likewise, during 2018, electronics was the biggest catalyst of online retail sale in India. It had a share of 48%. This was followed by the apparel industry which had a growth of 29%.

Such is the ever-increasing growth of the e-commerce business in India.