SMEs to gain as e-commerce grows?

Industry watchers estimate that the business growth potential for SMEs and small trade and business is set to double with E-commerce coming into full play.

The e-commerce industry has witnessed unmatched growth of 150%, increasing from Rs 19,249 crores in 2009 to Rs 47,349 crores in 2012. This growth has pulled in an increasing number of small retailers and manufacturers in the net and ancillary growth has risen almost equally in this duration.

Reiterating the importance of liberalising the E-commerce industry, Kiran Karnik, Chairman, CII National Committee on Broadband & Telecom said "SMEs are pivotal to the manufacturing sector in India. They need incentives and modern technology to enable them to achieve global competitiveness. E-commerce is providing them these platforms in a cost effective way. Any policy which restricts E-commerce will also create limitations for the growth of SMEs. It is therefore of critical importance to create the right policy environment for the liberalisation of B2C Ecommerce and its positive effects on the SME growth."

According to Shubho Ray, President, IAMAI, "Various entrepreneurial ventures have mushroomed by virtue of opportunities provided by e-Commerce. E-tailing, which is just 16 percent of the e-Commerce market today would grow to 30-35 percent by 2020 and is estimated to generate employment for around 1.5 million people by 2020. It has a huge potential for generating livelihood within the industry as well as in the auxiliary industries such as logistics, media etc. E-Commerce has provided the SMEs/MSMEs with an opportunity to reach out to millions of customers across geographies. The marketplace platforms helps them jumpstart their business with minimal investment."

Countering the campaign mounted by a section of retail trade bodies, which is trying to raise the old bogey of losing retail jobs, most industry players feel that the members of CAIT would do well to remember the speech of PM Modi at their own conference in February this year where he exhorted small and medium retailers to embrace E-commerce as a partner in growth and profitability.