Organised retail trade in India has seen good success, but it was only in limited pockets, and given the context of the country, it will be difficult for them to expand beyond a point, said Manish Tiwary, Country Manager, India Consumer Business, Amazon India.
He was delivering the chief guest address at the third V Narayanan memorial endowment lecture on the topic “How e-commerce is transforming retail in India,” organised by the Madras Management Association (MMA) in association with Pond’s veterans.
The annual lecture series was in the memory of Narayanan, who served as the chairman and managing director of Pond’s India Ltd., which became part of Hindustan Lever Ltd.
Tiwary explained that the reason that limits the growth of organised trade is the cost of people, land, and utilities. “The cost of utilities and real estate is quite high in the country. Plus, a bulk of real estate in India is highly litigated.”
Tiwary, an ex-Pond’s India employee himself, said the financial model of selling at MRP is not very robust in India.
He said this is where e-commerce plays a major role by cutting costs along the entire value chain using technology.
Tiwary said earlier brands took decades to establish themselves at the regional level before scaling up nationally, but today they could simply do it through e-commerce platforms, thereby saving a lot of money on advertising and distribution.
“It takes six minutes to become a national seller on Amazon,” Tiwary said.
He said the e-commerce giant, which has over 11 lakh sellers onboard, has set a target for cumulative exports by Indian exporters of $20 billion by 2025 via its platform.
In his address, V Balaraman, past president of the MMA and former MD of Pond’s India Ltd., recalled that Narayanan was keen on bringing out the extraordinary capabilities of each individual and that, under his leadership, it was ok to fail and start again.
