Small e-commerce sellers implore PMO to safeguard interests

By

Isabelle Crossley

Published
Dec 12, 2018

A group has written to the Prime Minister’s Office, ​stating that e-commerce platforms are exploiting small sellers and asking for an intervention.

The All India Online Vendors Association wrote: “The control of India’s retail market has been passed on to the hands of two foreign companies."

The two companies are Amazon India, owned by Amazon (U.S.) and Flipkart, now owned by Walmart. AIOVA consists of over 3,500 online sellers. The organisation has cited deep discounting as one issue that is impacting them. Many e-commerce firms reply on discounts to shift merchandise and push their own private labels for higher profit margins. Small sellers argue that this negatively impacts them.

The organisation’s letter also challenged the government for not including it in the Department of Industrial Policy and Promotion's ongoing discussions for the draft e-commerce policy.

“The think tank on ecommerce industry was formed and disbanded without our inclusion or representation,” said the letter.

Amazon India and Flipkart do hold promotions for small businesses from time to time but AIOVA argues that the system favours large businesses and so these promotions do little to help the situation.

However, an Amazon India spokesperson told ET Bureau, “Since our launch in India over five years ago, we have worked relentlessly towards creating a transparent marketplace for sellers of all sizes to sell, grow and offer the widest selection to our customers.” Amazon India is also holding a “Small Business Day” this month.

AIOVA is not the only organisation that has raised concerns over Indian e-commerce’s American ownership and discounting practices. The Confederation of All India Traders strongly protested Walmart’s Flipkart acquisition and has also argued that having the Indian e-commerce market dominated by U.S. businesses is bad for the country. The Indian Cellular and Electronics Association has also expressed concerns over the same.