oppn parties Shake Up in Ecommerce Marketplaces & Startups

News Snippets

  • Flipkart assures employees that there will be no job or salary cuts due to the COVID-19 pandemic
  • Although it was obvious, but the government still clarifies that there is no need to switch off appliances and only lights need to be switched off on April 5 at 9pm after confusion in the minds of some people
  • PM Modi and President Trump decide "to deploy full strength of (Indo-US) partnership" to fight against COVID-19
  • 17 states have reported 1023 cases of coronavirus linked to the Tablighi Jamaat, which translates to 30% of all positive cases in India
  • The government says people should not use alcohol-based hand sanitizers before lighting diyas or candles on April 5
  • The railways say there is no certainty yet when services will resume after the lockdown and a final decision will be taken in the next few days
  • As coronavirus cases multiply in Assam, six north-east states seal their borders with the state
  • Power System Operation Corporation Ltd. (POCOSO) putting all systems and protocols in place at war-footing to ensure there is no grid failure due to reduction in demand on April 5 at 9 pm
  • Power ministry scotches rumours that the power grid might fail due to the 9-minute blackout called by PM Modi on Sunday, April 5
  • Centre asks people to wear home-made masks if it is absolutely essential for them to step out of homes
  • Centre asks states to allow licensed street vendors to sell essential items
  • 8000 samples were tested across India on April 2, but the government said that testing will be need-based and will not be used as a confidence-boosting measure
  • Air India operating special flights to fly passengers stuck in India since the lockdown
  • For the first time in history, Darjeeling loses first flush tea due to suspension of garden work for Covid-19 outbreak
  • Supreme Court asks journalists to be responsible and publish only the official version of news after it was brought to its notice that migrant exodus started after the 'fake' news that the lockdown will be extended to three months
Total count stands ar 3082 as India records 16 Covid-19 deaths, the highest in a single day
oppn parties
Shake Up in Ecommerce Marketplaces & Startups

By Sunil Garodia
First publised on 2016-08-21 20:52:58

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator. Writes for a number of publications.
The ecommerce and startup space is readying itself for another round of acquisitions, amalgamations and mergers. As too many players have entered the market with the same faulty deep-discount-backed-by-heavy-advertising model, they are all chasing the same set of buyers with almost the same products. Not all of them have deep pockets and investors are not willing to fund their misadventures any more. Hence, the smallest ones or the weakest ones have closed operations while those who think they can find buyers at a decent price are looking for suitors. With the going getting tough, the tough are not getting going but the weak are capitulating. The consolidation that is taking place augurs well for the long term health of the sector.

Snapdeal is alleged to be looking for open arms from either Flipkart or Amazon. Earlier, it had closed down exclusively.com, a premier fashion and lifestyle marketplace it had acquired just 18 months ago, as a standalone platform by integrating it with itself. Shopclues is wishing to merge with Alibaba. Voonik has acquired three small startups this year. Ola has dumped the Taxi for Sure (TFS) platform after acquiring and putting it up on its app. The integration has been completed by shrewdly launching the economic Ola Micro and obviating the need of a separate TFS economy model. This will result in 700 employees being laid off. Askmebazar.com has temporarily suspended operations, but it is a clear indication that the platform is going down under as investor interest is zero and funds are not available. The problems of GoJavas, at one time the in-house logisitics partner of Jabong are well documented. It was spun off by Jabong as an independent logistics firm after which Snapdeal got into it. But with both Jabong and Snapdeal having stopped using GoJavas, the company first suspended operations and has not got a new investor in Pigeon Express (P) Ltd, a logistics service provider. Maybe the synergy with Pigeon’s current operations might rescue GoJavas but ecommerce logistics providers have certain bad habits (excess employees and other overheads) which Pigeon will have to take care of.

These are troubled times for both startups and established ecommerce players. Investors are increasingly looking for a solid revenue model and exciting new use of technology just for the sake of it is not getting the thumbs up. Timeframe for turning profitable is being demanded. It is good this is happening now as it will mean that henceforth only responsible managements will get funded and those trying the hit and miss formula will be refused politely. This will also mean that startups will spend more time with accountants than they have been doing till now. The time of falsely creating excitement around a business model by obfuscating its breakeven roadmap is now gone. Responsible budgeting, breakeven, profitability, prudent hiring, strategic and optimally priced acquisitions and smart and cost effective advertising are terms startups will have to familiarize with and use to keep a tight control on operation costs and show a healthy balance sheet to investors.