The Growth of SMEs in India will be driven by eCommerce


The eCommerce surge in India has been gaining a lot of pace in recent times. More and more Small and Medium Enterprises (SMEs) are now adopting eCommerce to grow sales.


The job market and the GDP contribution in the country has been driven by the industry bigwigs and big companies. However, a recent joint study by the research firm KPMG & Snapdeal revealed that the eCommerce sector in India is projected to cross $80 billion by 2020. More and more SMEs are now lending big numbers to the job market and GDP contribution. According to the study by KPMG in collaboration with Snapdeal, 85 percent of SMEs believe that the adoption of eCommerce is a cost effective medium for their sales numbers to prosper. eCommerce has enabled SMEs to cut down on their distribution, marketing and sales spends by 60 to 80 percent. The study also revealed that 46 percent SMEs have witness substantial growth through listings on online marketplaces. The Small and Medium Business Development Chamber of India is also working hard towards empowering the SMEs for global competitiveness. Earlier in July, another study by KPMG-IAMAI titled ‘India on the Go: Mobile Internet Vision 2017′ revealed that the internet penetration in India has surged from 13.7 percent in 2013 to 19.19 percent in 2014. More internet penetration means more mobile applications entering the market. The KPMG-IAMAI study also revealed that the mobile phone market in India is awaiting a rural fortune. These developments will further encourage SMEs to adopt eCommerce practices for better success. Enterprises from the far-fetched corners of the country are now looking to have their piece of the eCommerce boom. Mobile internet and eCommerce amalgamation can prove to be a perfect recipe for success for the SMEs. eCommerce is slowly shifting towards the paradigm of mCommerce. According to the KPMG-IAMAI study, the number of mobile internet users in India was 159 million in 2014. This number is expected to reach 314 million by the end of 2017 registering a CAGR of 27.8 percent for the period 2013-2017. Looking at these numbers, you can guess what eCommerce & mCommerce has in store for the SMEs.  Does this mean that eCommerce will cease to exist in the near future? The answer is a big ‘NO’. mCommerce will be taking eCommerce to the masses & the enterprises in Tier II/III cities will be benefitting a lot from the development.

Going back to the joint study by KPMG and Snapdeal, 43 percent of SMEs in India participate in online sales & 69 percent of them report an increase in customers due to the internet. Speaking about the study, Richard Rekhy, Chief Executive of KPMG India said, “The fast paced growth of the e-commerce industry in India represents an unprecedented opportunity for SMEs. We hope that the findings of this report will assist policymakers, industry bodies and e-commerce companies to strengthen the support ecosystem, which enables SMEs to ride the e-commerce growth wave successfully.” Kunal Bahl, Co-founder & CEO, Snapdeal also spoke at length about the study, he said,  “At Snapdeal, we are working towards building the most impactful digital commerce ecosystem in the country and SMEs form the foundation of this ecosystem in many ways. With over 200,000 sellers operating on our platform, we felt the need to conduct a systematic unbiased study to identify opportunities and challenges to further accelerate the growth of the sector.”


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About Thinking Aloud

“Thinking Aloud” reflects the emerging trends and varied outlook of the rapidly evolving internet and communication sector. An IAMAI publication, this is a part of the market education initiative of the association.

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