Covid-19: E-commerce firms in a fix over definition of essential goods

While delivery of essential items by e-commerce firms was exempted from the 21-day coronavirus (COVID-19)-induced lockdown called by the prime minister on Tuesday, online retailers are struggling with the distinction between essential and non-essential goods.

This caused them to face challenges on Wednesday, with many facing forced lockdown of warehouses and restrictions on deliveries, leading to a temporary shutdown of operations.

Paytm Mall told Business Standard that it was unclear whether clothing or home items qualified as essentials. Srinivas Mothey, senior vice-president of Paytm Mall, said that they had prioritised items like masks, sanitizers, ayurvedic supplements, immunity boosters, electronics and home items. “It is unclear whether clothing or home items qualify as essential items. A lot of professionals are working from home, and they need electronics for their productivity. Does this qualify as essential?”

Amazon has disabled shipments for lower priority products and is using logistics capacity to deliver critical products like household staples, packaged food, healthcare, hygiene, personal safety products.

Grofers has shortlisted essentials based on consumer demand. “We are prioritising high demand essentials such as atta, dal, canned food, ready-to-cook food, spices,” said Albinder Dhindsa, CEO and co-founder of Grofers. The firm has seen an 80 per cent surge in orders compared to last week.

Meanwhile, a multinational retail giant is busy reaching out to state governments to sift out essential and non-essential goods at its stores. “We are separating essential and non-essential goods on our application to cater to our members. However, our team is talking to state governments to get a specific definition of essentials,” an official said.

The guidelines issued by the Ministry of Home Affairs on Tuesday after the lockdown was announced exempted e-commerce deliveries of essential items “including food, pharmaceuticals and medical equipments”.

The lack of clarity over definition led to a breakdown on Wednesday, which was settled with the intervention of central authorities. Grofers’ warehouse in Faridabad was closed by local law enforcement on Wednesday, which was reopened after intervention by NITI Aayog CEO Amitabh Kant.

Bigbasket sent out a message to customers that deliveries could not be processed because of restrictions imposed by local authorities on movement of goods.

Eventually state governments reached out to warehouses and stores to collaborate for doorstep delivery of groceries. “Before the lockdown announcement, authorities were forcing shutdown of warehouses and stores, but things have turned around now. The authorities are reaching out to collaborate with us to carry out home deliveries of essentials,” said a senior executive of a large retail chain.

E-commerce players have also worked out flexible policies for sellers to cater to the demand.

Paytm Mall, for instance, has removed late processing charges, increased service level agreements and given flexibility to process orders in 10 days. “We are also supporting them with moving products to our courier partner fulfillment centres, which will help smaller merchants,” said Mothey.

Grofers said that it was in constant touch with manufacturing partners and supply chain to ensure that they were aligned and making quick arrangements in case there are momentary gaps. “We are also keeping a persistent check on how things are progressing and have put a plan for allocation basis demand to act faster in favour of our customers.”