E-commerce major Amazon India is investing long-term in the country, says Gopal Pillai, Director and GM, Seller Services, Amazon India. Amazon, which tied up with Tantuja, the apex body of handloom weavers of West Bengal, will start with selling sarees in the US (through Amazon.com). According to Pillai, Amazon India will look to work backwards — from the seller’s need — in order to remove the perception that selling online is difficult. The company operates through a market place model with nearly 175,000 sellers in India. It services 20,000-odd pin-codes and nearly 65 per cent of sales are from tier-II cities and downwards. In an interview to BusinessLine, Pillai talks about similar tie-ups to promote Indian handicrafts, bringing more sellers on board, and profitability. Excerpts:
Can you run us through the tie-up Amazon.com has with Tantuja?
Right now we are starting with the US. We will then explore taking it to other countries like the UK, or (countries of) European Union. (Even) Japan could be an option because Tantuja has quality scarves which can appeal to any customer. We would look to take the entire range and offer a wider selection.
Are you also in talks with other State government organisations, say a Jharcraft, for similar offerings?
I cannot comment on the on-going conversations. But we have signed an MoU with the Government of Gujarat to sell the products manufactured by their tribal entrepreneurs, on Amazon India.
Development Commissioner of Handlooms is the other initiative where we will partner with the cooperative societies and sell their products here. This apart, we have signed up an agreement with the NSDC in Nagaland where we enable women entrepreneurs to come online. For lot of these things to be successful you need someone like the Development Commissioner of Handlooms or a Tantuja to partner and educate the craftsmen. We are conducting regular workshops too.
How is your programme to have global sellers from India working?
We had a few 100 sellers when we began in May 2015. And, today, we have 20,000 sellers with a listing of 45 million products across categories such as home décor, apparels, toys, tapestry, leather-jackets and so on.
So whether it is taking small manufacturers from here or the B2B manufacturers who are selling to stores in the US, we are able to give access to the global customers. We have been able to take some of the well-known brands from India that includes FabIndia, Biba, Amul, and others.
What is the number of sellers on Amazon.in?
We have seen a 160 per cent growth in sellers to 175,000 (y-oy) and right now have a product listing of 100 million. The daily average listing has jumped to 180,000 products a day. Now compare this to an organised retailer that stocks around 15,000 products a day. That shows the fly-wheel is spinning and people have seen value and are adding more products on the platform.
Will re-working seller commissions affect growth?
We hope not. Revision of commission is done on a periodic basis. While fees have been increased for certain categories, we have also decreased fees for certain categories like sports, gold coins, personal care appliances, etc. We also removed the delivery service fee which used to 1.25 per cent of the average selling price, among others.
Has Indian e-commerce lived up to expectations?
When you talk about dotcoms going bust, it is not restricted to India only. In the US, companies which gave a clear value proposition have survived. India is currently going through a somewhat similar. However, we believe e-commerce here is at a very nascent stage and there is room for many players.
How soon can Amazon turn profitable in India?
While we do not share the specifics, let me say we are here for the long term. We are a long-term focused company and we want to make investments. These investments are not cheap and we are willing to make it.
Will your India aspirations take a hit with Indian start-ups demanding a level playing field or protection in some form against foreign competition?
Amazon is and will be 100 per cent compliant to any regulation. So there is no specific benefits we get. Internally, we believe Amazon is an Indian company with a mission of transforming how India buys and sells. And if you look at various forums, you will see customers are supporting us. We are happy with the progress, and the support from the customers and sellers.
Regulations like GST will benefit with relation to inter-State transfer of goods. It will also make things easier for SMBs.
Original source http://www.thehindubusinessline.com/info-tech/we-are-here-for-the-long-term-amazon-indias-gopal-pillai/article9647694.ece