Nation Current Affairs 28 Dec 2018 No more deep pocket ...

No more deep pocket discounts by etailers

Published Dec 28, 2018, 12:34 am IST
Updated Dec 28, 2018, 1:35 am IST
Government tightens norms for e-commerce business.
Cut-throat competition has taken its toll on various players who are asking for a neutral playing field.
 Cut-throat competition has taken its toll on various players who are asking for a neutral playing field.

Hyderabad: After the Centre’s notification on Wednesday, consumers are wondering whether discounts will continue from e-commerce firms, would there be new retail tie-ups by multinational e-commerce companies and whether the government would be able to regulate the sector.

Founder and chief executive officer of Ameen Khwaja said, “Retail tie-ups are known in the industry. We are waiting to see how the government’s orders are implemented. The major question is whether the practice of making losses and still offering discounts to consumers works.”


He said large companies would survive, but not the small ones. “The notification is important and it must be implemented properly,” he said.

Large e-commerce sites like Amazon and Flipkart have equity in retail sellers due to which they can offer huge discounts. The offer is good for the consumer but the companies are running into losses.

In the bargain, the e-commerce sites are killing the competition and smaller players who are in the market. This has led to widespread discontentment.

Secretary-General of the Confederation of All India Traders (CAIT) Praveen Khandelwal said e-commerce sites were selling products at unreasonably low prices.

“They are incurring losses in a bid to get monopoly. Such practices have to stop as there are many small and medium traders whose survival is at stake. We are glad that the government has come out with this notification and it will make a difference,” Mr Khandelwal said.

Cut-throat competition has taken its toll on various players who are asking for a neutral playing field. 

Chief Executive Officer of SR Innovation Exchange said, “It is high time this large  marketplace created a neutral platform and enabled a fair opportunity for smaller vendors. There is a need to avoid monopoly of single vendors.”

Will there also be new tie-ups with retailers who have exclusive brands? Mr Ashok Reddy, founder of Gabon, said, “This will be used as an opportunity by both Flipkart and Amazon to release new personalised brands. This is going to be good for the government and the market. The consumers will have a wider choice.”

The tone in the market is that of being set for a level playing field by the big players. Mr Kunal Bahl, chief executive officer and co-founder of Snapdeal, said, “The update to the FDI policy on e-commerce means that there will be balanced growth. It will help to create a level playing field for all sellers.”

Does this mean that this January, consumers will see the last of the deep pocket discounts by e-commerce companies? Many of them say yes, as the order is due to be implemented from February.

Location: India, Telangana, Hyderabad