Leading e-retailers, including Snapdeal, on Wednesday, welcomed the Government’s decision to open e-commerce market place for 100 per cent FDI, even as IT industry body Nasscom termed 25 per cent cap on sales from a single vendor or group entities as “restrictive”.
“…more so if the vendor sells high value items. The industry might face difficulties in case of sale of electronic items, where a vendor maybe offering exclusive access to certain items or discounts. Marketplaces have no control on how a product is priced and only organise ‘sales’ where vendors participate,” Nasscom said in a statement.
Nasscom is the premier organisation that represents and sets the tone for public policy for the Indian software industry.
Indian e-commerce behemoth, Snapdeal, released a statement that said the norms will provide clarity to India’s fast growing e-commerce industry.
“These guidelines recognise the transformative role that e-commerce marketplaces will play in the Indian market. It is a comprehensive announcement which will pave the way for accelerated growth of the sector in India,” Snapdeal’s statement said.
The Government on Wednesday, while allowing 100 per cent FDI in market place format of e-commerce retail, said these firms will not be permitted to sell more than 25 per cent of the sales affected through its market place from one vendor or their group companies.
The move will also support the Make In India initiative.
The cap of 25 per cent on sales by a vendor on marketplace will ensure a broadbasing of vendors for a true market place.
Sellers like Cloudtail and WS Retail account for a major chunk of sales on Amazon and Flipkart, respectively.
Cloudtail is a joint venture between Amazon Asia and Infosys founder NR Narayana Murthy’s personal investment vehicle Catamaran.
WS Retail was set up by Flipkart co-founders Sachin Bansal and Binny Bansal in 2010.