Logo of e-commerce firm Amazon and Flipkart. Photograph:( Reuters )
The growth rate for most companies is expected to dip to a single-digit, with a lot of monetary loss in the process
The country is currently undergoing a 21-days lockdown to prevent the virus from spreading in the country. Forrester, a market research firm has released data which claims that the e-commerce industry in the country will take big hits from the lockdown, almost amounting to US $1 billion.
The growth rate for most companies is expected to dip to a single-digit, with a lot of monetary loss in the process.
This loss will cause a trickle-down effect, causing large losses to not only companies, but to small sellers and enterprises on online portals.
In conversation with Entrackr, Forrester’s senior forecast analyst Satish Meena, claimed that a loss of over one billion dollars is expected for e-commerce platforms.
Factors affecting the business include disruption of chain supplies, limited consumer spending, and lack of items most needed during a crisis.
Non-essential goods account for 70 per cent online sales in the country. These translated into over $32 billion, during the last year.
The previous hopes of a growth over 26 per cent has been muddled by COVID-19, along with the precautionary measures in place globally. Essentially, everything is shut down, stocks are low, and people have lesser demand.
With no clear picture in sight for what holds next, as the pandemic largely remains unpredictable, growth is not expected to revive until next year.
As people also face the prospect of becoming unemployed with companies sustaining losses, goods like smartphones, clothing, appliances will suffer.
Most business, physical and online have been shut since last week, after the Prime Minister, Narendra Modi imposed an unprecedented national lockdown.
Flipkart and Amazon, India’s biggest e-commerce giants have suffered at the hands of the outbreak, as sale of goods was disrupted for a week. Amazon resumed selling essential goods only a few days ago. Even then, most essential goods are not from familiar brands, raising suspicion among consumers, who are preferring to venture out to buy supplies as e-commerce delivery services are overburdened and understaffed.
As of now, transportation of goods is allowed. But most people are expected to mostly order groceries and essentials like sanitisers, soap, and masks.
The confirmed cases in India continue to rise exponentially on the daily.
1251 cases have been confirmed so far, with over 30 deaths.