Amazon India is taking steps to reduce the damage to businesses of its SMB vendors due to the coronavirus epidemic and the imposed lockdown.
Protecting small entrepreneurs and SMBs is definitely in the interest of Amazon India. A significant number of its six lakh vendors are made up of small entrepreneurs, SMBs, women vendors, artisans, weavers etc.
Some of the steps the company has taken include a 50 per cent discount on sales to Amazon (SOA) by the end of June 2020, a waiver of storage fees for vendors, relaxing their account performance metrics, and more.
In the Money Matters series, Shraddha Sharma, Founder and CEO of Yourstory interacted with Amazon India VP Seller Services, Gopal Pillai. Where he explains in depth the steps taken by the ecommerce giant to help SMBs save themselves from the current COVID-19 crisis, and how it will help them grow into a long-term medium of exports helping.
Watch full interview here
The Kovid-19 crisis and lockdown have led to significant disruptions and crippled the MSME sector, where businesses rely largely on recurring sales to meet fixed costs. With almost zero revenue, many of these SMBs are in an unprecedented financial crisis.
Currently, these businesses do not have the funds to continue production, pay their rent and bills, and compensate their employees.
“Indian small businesses form the backbone of the economy, and therefore, when they are affected, the entire economy is affected. Gopal says that for the past eight weeks Amazon India has been understanding their pain and their challenges.”
Lack of access to capital, low availability of raw materials and supplies, serious logistics issues, and difficulty maintaining a workforce are the top issues faced by SMBs.
Gopal believes in the power of eCommerce and ensures that large enterprises like Amazon India can play a big role in helping SMBs and vendors to tackle the current crisis.
“E-commerce has become the safest way for small businesses to supply products and their needs. They say they do not have to go to physical markets or trade fairs for source products. ”
For SMBs, there is no playbook or rule of thumb to follow. As they learn, proprietors of these enterprises are finding new ways of doing business, especially through digital mediums and the ecommerce marketplace. Amazon India wants to be the catalyst to bring about this change.
“Our survey showed that SMBs are looking at online channels as a way to diversify their businesses. They know that their footsteps will not descend to previous levels. Thus, Amazon India has come up with several initiatives to help them, ”says Gopal.
He talks about Amazon SMBhav in January 2020, a two-day summit held on India’s SMB ecosystem, where Amazon founder and CEO Jeff Bezos paid $ 1 billion to digitize Indian SMB. did.
Gopal adds, “As a long-term goal, we have also promised to digitize 10 million SMBs by 2025. In the short term, we are paying Rs 10 crore to bring local shop owners to our programs.”
In mid-April, in an earlier conversation with YourStory, he revealed that the e-commerce chief is taking six steps to stand out by his vendor partners.
Focus on export
In the wake of the coronavirus epidemic, economies are slowly looking to reduce their dependence on Chinese imports and diversify their manufacturing. This provides a good opportunity for Indian SMBs to consolidate their exports and capture the international market.
“India is well positioned in terms of exports. But the real question is how do we help small Indian entrepreneurs reach global customers? To answer this, Amazon India has a global sales program with more than 60,000 manufacturers and resellers listed. This initiative helps put Indian SMBs on the global map and provides access to markets in 185 countries.”
He adds that there is a common misconception that exports usually mean B2B trade. In reality, B2C export is possible, and e-commerce is giving major Indian SMBs access to thousands of end consumers globally.
The last few years saw a lot of scepticism among SMBs about selling online. But now, as these SMBs wake up to a new normal of online trading, Amazon India plans to stand firm and accelerate change.
“Successful Indian SMBs are always looking to learn, and have the motivation and passion to succeed. A vendor making revenue of Rs 1 lakh always thinks how to make Rs 50 lakh. A vendor making Rs 1 crore revenue is wondering how to reach Rs 100 crore. They are hungry, and this drives them to success. ”
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