#7 Reasons to Invest in Indian B2B E-commerce Marketplace Due to continuous demands from SMEs on a logistic front lot of B2B E-commerce players are coming up and growing exponentially.
By Jayesh Desai •
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If you see the current scenario of a business ecosystem in India you will notice that investors are banking heavily on B2B E-commerce than B2C E-commerce due to its tremendous growth in recent times with less risk factor involved. Due to continuous demands from SMEs on a logistic front lot of B2B E-commerce players are coming up and growing exponentially.
Currently, B2B E-commerce is booming with opportunities and talent. If right investments can be made into the budding B2B sector, it can address the competition and expectations of the market. B2B E-commerce marketplace has the potential to grow exponentially, and it will benefit both the investors and the business community.
According to me below are the seven reasons to invest in Indian B2B E-commerce marketplace-
- Boost in India's Economy
E-commerce is a growing sector in India. The contribution of E-commerce to our GDP is expected to grow around 15-20% in the coming years. E-commerce is what worked the best in the time of demonetization. After the initial wave of B2C E-commerce, the B2B sector is also gaining a lot of attention and traction. Since B2B sector is a little disorganized in India at the moment, proper investment channels will help in organizing it with technology and thus, it will benefit the overall economy of our country. Optimization, productivity gain, and efficiency of operations aided by e-commerce would not only transform industrial sectors but also elevate the fortunes of Indian Economy
- The Exceptional Growth of B2B E-commerce
The entire B2B structure of India is developed on a wholesale network. The supply and demand framework of this structure works in a perfect combination of complexity and ease. You will also see a lot of private funding happening these days in this sector. Different movements by the Government of India to bring B2B purchases online has also worked for this marketplace. E-commerce extends the reach of industry. It creates many new business possibilities. It tends to disrupt the monopolies of the market, hence, issues associated with them. It brings an unprecedented transparency. More importantly, it makes the market intelligence available to the large sections. It makes business more predictable, hence, improves risk taking capability of a company.
- Digital Acceleration
Thousands of SME's, wholesalers, producers, buyers etc. are going on board for digitization of B2B E-commerce. And with technological rise reaching such heights, there is a comfort as well as benefits in investing in Indian B2B marketplace. Digitization of SMB sector is primarily caused by four dominant factors: (1) Increasing use of E-commerce platforms for sale of goods (2) Increasing thrust on bringing the companies online (3) Gradual adoption of social media channels for marketing and branding (4) Special cloud solutions for SMB (5) Industrialization of 4.0. On the top of it, push from the government on Digital Payment and GST have been driving the digital acceleration of SMB sector.
- GST Implementation
B2B SMEs have a lot of benefits due to GST implementation. Due to the uniform tax regime, they will no longer face tax disadvantage outside their home state. With E-commerce marketplace and the nationwide access, business will be successful in all parts of India which will result in efficient business and reduction of middlemen. The following are measured long-term benefits of GST-
- Realization of business possibilities due to uniform tax structure
- Easy and quick geographical expansion
- Efficient and productive supply chain
- Unleashing of many new possibilities of business expansion and partnership
- Making use of under-utilized capacities that would save much of capital investment
- Less Risk
B2B markets are less risky than B2C. This is mostly due to the fact that they deal with the people who have the same business mindset that they have and profit earning is faster than that of B2C. Chances of suffering from loss are also less than that of the B2C industry.
The B2B marketplace would generate abundant information about capacities, their utilization, and trends of their utilization. It would also create information about the business leads, their character, and their trends. This information and intelligence can help identify, predict and manage risks properly
- Low Cost :
As far as investment in B2B e-commerce sector is concerned it is way lower as compared to investments in B2C E-commerce. In B2B E-commerce investments are lower as major spending is only on product development and business expansion with multiple channels whereas in B2C, apart from product development there are high expenses involved when it comes to promoting that product/Marketplace hence higher cost of investments are involved in B2C.
Moreover, B2B E-commerce is bound to increase productivity, efficiency, and utilization. This would have downward pressure on the cost
- Industry Buying
In B2B ecosystem, industries are dealing with other industries of the same business line or the other. Striking a deal with a company set in the same lines of business for profit is concrete than B2C. Investing in B2C and dealing with consumers at large do not guarantee profit and does not ensure smooth process but in B2B E-commerce it does help.
As transparency, visibility, performance, productivity and user feedback are the key attribute of B2B E-commerce ecosystem, striking deal through them would be much enriching, convenient and fulfilling.
