As SMBs scramble to survive the disruption caused by the coronavirus pandemic and the extended lockdown, Amazon India has been taking steps to mitigate the damage caused to its SMB sellers’ businesses.
Protecting micro-entrepreneurs and SMBs is certainly in Amazon India’s interest. A significant number of its six lakh sellers is made up of micro-entrepreneurs, SMBs, women sellers, artisans, weavers, etc.
Some of the steps taken by the company include a 50 percent waiver on Selling on Amazon (SoA) fees till the end of June 2020, waiving of storage fees for sellers, relaxing their account performance metrics, and more.
On Money Matters with Shradha Sharma, Gopal Pillai, VP Seller Services of Amazon India, delves deeper into the steps taken by the ecommerce giant to help SMBs survive the current COVID-19 crisis, and explains how it is helping them grow in the medium-to-long term through exports.
A sector brought to a standstill
The COVID-19 crisis and lockdown have caused significant disruptions and crippled the MSME sector, where businesses largely depend on recurring sales to meet fixed costs. With near-zero revenue, many of these SMBs are in an unprecedented financial crisis.
At present, 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 so, when they are impacted, the whole economy gets impacted. Amazon India has been working with them for the last eight weeks to understand their pain points and the challenges they are facing,” says Gopal.
Lack of access to capital, low availability of raw materials and supplies, severe logistical issues, and difficulty in maintaining a workforce are the top issues faced by SMBs.
Gopal believes in the power of ecommerce, and maintains that large enterprises like Amazon India can play a big role in helping SMBs and sellers to tide over the current crisis.
“Ecommerce has become the safest way for small businesses to get access to products and supplies they need. They don’t have to go to physical marketplaces or trade fairs to source products,” he says.
A helping hand
For SMBs, there is no playbook or a rule of thumb to follow. Learning as they go, proprietors of these enterprises are finding new ways to do business, especially on digital mediums and through ecommerce marketplaces. Amazon India wants to be the catalyst for bringing about this change.
“Our surveys showed us that SMBs are looking at online channels as a way to diversify their business. They know their footfalls are not going to recover to previous levels. Thus, Amazon India has come up with a number of initiatives to help them,” Gopal says.
He talks about Amazon SMBhav, the two-day summit in January 2020 focussed on India’s SMB ecosystem, where Amazon founder and CEO Jeff Bezos committed $1 billion to digitise Indian SMBs.
“As a long term goal, we also pledged to digitise 10 million SMBs by 2025. In the short-term, we are committing Rs 10 crore to bring local shop owners into our programmes,” Gopal adds.
In mid-April, in an earlier interaction with YourStory, he explained six steps the ecommerce major is taking to stand by its seller partners.
In the wake of the coronavirus epidemic, economies are slowly looking to reduce their dependence on Chinese imports, and diversify their manufacturing. This spells a good opportunity for Indian SMBs to strengthen 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 selling programme with over 60,000 manufacturers and resellers enlisted. This initiative helps put Indian SMBs on the global map and provides access to markets in 185 countries,” Gopal says.
He adds that there is a common misconception that exports usually mean B2B trade. In reality, B2C exports are possible, and the ecommerce major has been providing Indian SMBs with access to thousands of end consumers globally, he says.
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 doing business online, Amazon India is planning to stand firm and accelerate the shift.
“Successful Indian SMBs are always looking to learn, and have the motivation and passion to succeed. A seller making Rs 1 lakh revenue is always thinking about how to make Rs 50 lakh. A seller making Rs 1 crore revenue is thinking how to reach Rs 100 crore. They’re hungry, and this drives them to success,” he says.
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