Amazon, Flipkart help small businesses get ready for post-Covid-19 world

With the Covid-19 crisis and the lockdowns severely impacting small businesses, Amazon and Flipkart are playing a key role to support these firms revive their business. These e-commerce majors are bringing them online, handholding them to pivot and helping them find fresh opportunities in the market. Amazon and Flipkart are also supporting them through various initiatives ranging from working capital to coronavirus related health insurance.

“Covid-19 hit everyone. In India, it's even more because small businesses are the backbone of the economy and they were hit really bad,” said Gopal Pillai, vice president for seller services at Amazon India. “In the last 10-12 weeks, we have (launched) multiple programmes and initiatives to really help small businesses,” he said.

The pandemic has caused consumers to form new online buying habits, throwing up new opportunities for small firms. Experts said consumers are getting a majority of their essential and non-essential supplies home delivered via e-commerce platforms to minimise exposure to others and for convenience.

Amazon has over 600,000 sellers on its India marketplace. The company said its seller registration run rate continues to be robust with thousands of new sellers registering on its platform. There are now more local shops, retailers and brands looking towards e-commerce to jumpstart and scale their business. The firm said it is seeing a 40 per cent increase in search queries from businesses looking to launch on Amazon and a similar increase in new seller registrations versus pre-Covid-19. Over 90 per cent of its sellers are pre-Covid-19 sellers which are actively selling on Amazon. These sellers have contributed to bringing back, 90 per cent of Amazon’s pre-Covid-19 selection back on the marketplace.

Amazon's e-commerce transactions are exceeding the pre-Covid-19 daily sales volume, ever since the lockdown was opened. “There is a continued spike and we haven't seen any reduction in that increased demand," said Pillai.

To address this demand, Amazon has rolled out our new Local Shops initiative that allows local shopkeepers to scale up their reach with Amazon.in. Sellers will be able to use Hindi to register on Amazon.in marketplace and manage their online business. The firm is seeing new sellers emerging from previously untapped geographies like Darbhanga in Bihar, Barmer in Rajasthan and  Mahoba in Uttar Pradesh. The other places include Hailakandi in Assam and Bardhaman in West Bengal.

Amazon has also taken various steps to help its sellers navigate this challenging situation. As sellers jump-started their business on the platform, the firm had set up an ‘on-demand disbursement’ feature that enables sellers to get their disbursements daily. It has provided 50 per cent waiver on ‘Sell on Amazon’ fees for small sellers to help them manage their working capital better. The company also waived off several other fees related to fulfilment centre storage, business advisory and for startup programmes.

Amazon’s rival Flipkart has also enabled more than 90 per cent of its sellers to resume business on the platform since April. The Walmart-owned firm said it had seen a 125 per cent increase in new sellers signing up on the platform, in comparison to its existing seller base, for April-June. The firm works with over 200,000 sellers and 250,000 small sellers such as artisans, weavers, and craftsmen.

Flipkart said the impact of the pandemic has urged businesses across the country to rethink their usual mode of operating and identify newer ways to function. One of the sellers is Sanjib Prasad who runs  Kartbin Online Service Pvt. Ltd. on Flipkart. The firm sold a variety of products across categories such as shampoos, fragrances and its own line of t-shirts. Due to the lockdown restrictions, his business suffered and the orders on his platform got reduced from 1500-1700 per day to 300-350. But catering to the demand for hand sanitisers allowed Prasad to sustain his business. He managed 30-40 per cent of the business by selling sanitisers on Flipkart. This supported him to provide salaries for his 20-member team. “We recently started selling masks and that is now helping us increase our revenue,” said Prasad.

Another entrepreneur, Nilesh Dodega, a mobile phone accessories retailer from Udaipur had joined Flipkart over a year back to complement the revenues from his offline retail store. The lockdown made both his offline and online business come to a standstill. 

To capitalise on the market demand in the post-lockdown period, he focused on his online business. Flipkart supported him for in-depth proactive planning and coordination efforts. As soon as the lockdown was lifted, he was not only was he able to start selling online immediately but was also able to meet 3x demand. His sales increased from 450 units a day to 1,200 units a day post lockdown.