Credit, efficient supply quality of products, and “feet on street” assistance are some of the critical offerings of eB2B platforms.
The unorganised general trade (GT) channel is driving India’s retail market growth and will likely double in size from $0.7 trillion to $1.4 trillion by 2030, finds a report by Redseer Strategy Consultants.
The strategy consulting firm further projects that the B2B GT opportunity in India will reach approximately $1.2 trillion by 2030, with eB2B emerging as a promising digital procurement solution. India’s eB2B market is one of the fastest growing in the world, and is set to reach $90-100 billion GMV by 2030, says Redseer, making it the de-facto channel for brand marketing and advertising spend, and a Holy Grail for retailer insights and data intelligence.
The reason is that eB2B platforms have effectively resolved unorganised retail’s pain points such as higher prices, no credit option, late delivery, and at times poor quality of products, among others, observes the report.
Credit, efficient supply quality of products, and “feet on street” assistance are some of the critical offerings of eB2B platforms. “Retailers, brands and manufacturers have realised eB2B market’s potential and are betting on it to shape the way they do business,” says Mrigank Gutgutia, partner, Redseer. “India’s eB2B market has scope for multiple models but multi-category play with wide category coverage and national coverage is likely to win.”
In order to access underserved markets, brands are turning increasingly to eB2B, either as an addition to their current distribution network or as a replacement for ineffective traditional distributors. The report suggests that approximately 50% of the non-users are willing to shift to eB2B platforms in the coming year.
Retail players with multicategory revenue have a better margin opportunity through B2B e-commerce. While the Ebitda margin post-value added services revenue stands at 3-5% for the eB2B grocery vertical and 5-7% for the discretionary vertical, under multi-category it stands at 6-8%. In other words, getting the category mix is critical to boosting margin profiles.
Thanks to the size of the opportunity, faster adoption and deeper engagement, multi-category national players are best placed to grow with this market. Among eB2B players, Bengaluru-headquartered Udaan is emerging as the clear leader, followed by Jiomart, a joint venture between Reliance Retail and Jio Platforms.
Also read: Large steel players may face twin blows from export duty, shows CRISIL research
At scale, eB2B platforms are likely to have an ROI of 50%-plus, much superior to offline retail as well as cash and carry formats, says the report.
For manufacturers, traders, dealers, wholesalers, and retailers, implementing a digitised supply chain ecosystem using platform-driven techniques has become imperative.
https://www.financialexpress.com/industry/eb2b-a-100-bn-opportunity-redseer/2649850/
