Why Does Amazon Value India B2B Market So Much?

According to an executive inside Amazon, India businessmen have great potential in the global B2C and B2B business, and will probably surpass them.

India station's B2C business.

According to the world clothing and shoe net, Amit Agarwal, head and vice president of Amazon India station, said that the lack of competition and high profit margins made India businessmen have huge profit opportunities in B2C and B2B businesses.

Amazon said that in the next 18 months, payment services will become an important part of India's business development.

India

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It is experiencing a slow growth stage, though Amazon India station insists that its growth rate is far higher than that of the market.

In addition, Amazon said its Amazon Fashion development has far exceeded Flipkart Fashion, Myntra and Jabong.

Agarwal said: "2017 is the fastest growing platform.

According to IMRB data from October to November, Amazon Fashion (excluding other Amazon affiliates) has the largest turnover.

Experts say Amazon has the advantage of a pioneer compared to its rival Flipkart and Alibaba.

After announcing the acquisition of eBay India station, Flipkart announced that it had begun to enter the global retail market.

Flipkar said this initiative will help its platform sellers further use eBay's global platform.

Alibaba has been operating B2B business in India for nearly ten years.

TCM Sundaram, founder and general manager of IDG Ventures India, said: "Alibaba is selling Chinese products to India buyers. Nothing can stop Alibaba from developing large and medium-sized enterprises in India.

Amazon is preparing for long-term competition with Alibaba. "

According to reports, in November, India sellers sent more than 1 million 500 thousand items to Amazon's warehouse in the us to cope with the sales peak of black Friday and Monday.

"In recent months, India sellers have sold about hundreds of millions of dollars (commodities), up by more than 100% over the same period last year.

I estimate that in the next 5 years, the global business of India sellers will be far ahead of their domestic business, "Agarwal said.

"An important reason why India entrepreneurs are keen to sell products to the global market is that the average price of products in the international market is relatively high, which makes India sellers have a high profit margin, which is not available in India's local market," Agarwal said in an interview.

Some of the India brands that are sold worldwide are mainly Dabur, Himalaya, Titan, Patanjali, Amul and so on. Amason (Amazon) thinks this is a good opportunity for them to promote India's manufacturing.

India's B2B potential is greater than B2C?

In addition to the global open shop project, Amazon launched the B2B platform, Amazon Business, for small and medium-sized enterprises in India in September 2017, which was launched after the implementation of the new GST tax system in India (July).

Amazon has said that Amazon Business is a platform for wholesale retailers.

"The introduction of new GST in India is the perfect time for us to build the B2B platform. The reason why we didn't launch the platform before is that the business of Amazon will start to lose 2% of its profits before the rules are clear." the implementation of the new GST is expected to bring India a harmonious national commodity and service market and form a simplified (tax friendly) tax administration system, "Agarwal added." in the long run, with the development of business, India's B2B business is bigger than B2C's business, and its profit margins are large. This is a fertile land waiting for reclamation. "

In order to deal with a large number of B2B cargo pportation problems, Amazon India station plans to start logistics infrastructure in India.

In addition, over the past 2 or 3 years, Amazon has also increased its interest in global markets such as the US and UK B2B businesses.

In February 2017, Forrester, a US research firm, predicted that by 2020, the scale of India's e-commerce retailing industry would be 48 billion US dollars, a decrease of more than 1/3 compared to 2016's estimated value of US $75 billion.

The main reason for this decline is that India abolished the large currency in November 2016, and issued some new regulations for electricity suppliers, which reduced consumer funds and reduced purchasing power.

But Forrester said India is still the fastest growing e-commerce retail market, ahead of Korea and China.

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