{"id":115405,"date":"2021-06-29T21:03:16","date_gmt":"2021-06-29T15:33:16","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=115405"},"modified":"2021-06-29T21:07:40","modified_gmt":"2021-06-29T15:37:40","slug":"india-must-be-wary-of-monopolistic-e-retailers","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/india-must-be-wary-of-monopolistic-e-retailers\/","title":{"rendered":"India must be wary of monopolistic e-retailers"},"content":{"rendered":"\n<p><b><span data-contrast=\"auto\">Source<\/span><\/b><span data-contrast=\"auto\">: <a href=\"https:\/\/indianexpress.com\/article\/opinion\/columns\/e-commerce-india-new-draft-regulations-amazon-walmart-flipkart-jio-mart-retail-marketplace-7380109\/\">Indian Express<\/a><\/span><\/p>\n<p><strong>Relevance<\/strong>: Impact of monopolistic companies and ways to combat such monopolies<\/p>\n<p><b><span data-contrast=\"auto\">Synopsis<\/span><\/b><span data-contrast=\"auto\">:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><span data-contrast=\"auto\">The technological superiority and huge capital have enabled the e-retailers\u00a0to capture a significant share of the Indian retail market. They may convert themselves into monopolistic entities\u00a0in\u00a0the near\u00a0future which may pose numerous problems\u00a0for the nation.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<h5><b><span data-contrast=\"auto\">Background<\/span><\/b><span data-contrast=\"auto\">:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/h5>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-aria-posinset=\"12\" data-aria-level=\"1\"><span data-contrast=\"auto\">The big e-retail firms like\u00a0Jio Mart, Amazon,\u00a0Tata Group\u00a0etc. enjoy a\u00a0large share of the Indian retail market.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-aria-posinset=\"13\" data-aria-level=\"1\"><span data-contrast=\"auto\">Experts believe that the market would value at $2 trillion dollar by 2030\u00a0and would be dominated by few big e-retail companies.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><b><span data-contrast=\"auto\">How would they dominate the market?<\/span><\/b><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"14\" data-aria-level=\"1\"><span data-contrast=\"auto\">Big e-retail companies, by\u00a0<\/span><b><span data-contrast=\"auto\">being procurers of goods in large volumes<\/span><\/b><span data-contrast=\"auto\">, dictate bottom of the pit prices and impose stifling terms on manufacturers.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"15\" data-aria-level=\"1\"><span data-contrast=\"auto\">Along with investment in Artificial Intelligence and process systems, their delivery prices to consumers will eventually be less than the procurement price of\u00a0kirana\u00a0stores.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"16\" data-aria-level=\"1\"><span data-contrast=\"auto\">E-retail companies\u00a0would become<\/span><b><span data-contrast=\"auto\">\u00a0super distributors to\u00a0kirana\u00a0stores<\/span><\/b><span data-contrast=\"auto\">\u00a0and\u00a0will use them\u00a0as\u00a0pick-up points for ordered merchandise. Simultaneously,\u00a0kirana\u00a0stores will be nudged and compelled to increase the minimum order size, driving up inventory costs and losses for such stores.\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"17\" data-aria-level=\"1\"><span data-contrast=\"auto\">This\u00a0would be\u00a0a temporary arrangement and over the next 10-20 years, a majority of\u00a0kirana\u00a0stores will close.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"2\" data-aria-posinset=\"7\" data-aria-level=\"2\"><span data-contrast=\"auto\">Along with them, interdependent businesses of supply chain intermediaries and hundreds of thousands of medium and small enterprises that supply to these stores will slowly cease to exist.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"18\" data-aria-level=\"1\"><span data-contrast=\"auto\">Inevitably, as stores dwindle in numbers, consumers will find single suppliers and face a\u00a0<\/span><b><span data-contrast=\"auto\">monopoly<\/span><\/b><span data-contrast=\"auto\">.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"2\" data-aria-posinset=\"19\" data-aria-level=\"1\"><span data-contrast=\"auto\">They may also\u00a0<\/span><b><span data-contrast=\"auto\">take\u00a0support of the political class<\/span><\/b><span data-contrast=\"auto\">\u00a0to promote their products. For instance, Paytm flourished as a home grown (swadeshi) brand\u00a0with active support from politicians\u00a0during the demonetization. While in reality it\u00a0has investors from various countries including Alibaba from China.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"2\" data-aria-posinset=\"8\" data-aria-level=\"2\"><span data-contrast=\"auto\">Furthermore, now politicians have stopped\u00a0opposing\u00a0FDI in retail, a deviation from their earlier stance.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h5><b><span data-contrast=\"auto\">Problems associated\u00a0with monopolistic e-retailers<\/span><\/b><span data-contrast=\"auto\">:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/h5>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"3\" data-aria-posinset=\"20\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">First<\/span><\/b><span data-contrast=\"auto\">, there\u00a0<\/span><b><span data-contrast=\"auto\">would be lost of employment.<\/span><\/b><span data-contrast=\"auto\">\u00a0Many among the\u00a020 million small establishments (the\u00a0kirana\u00a0stores)\u00a0would be closed. Further,\u00a0the 40 million families spread across every street of the country dependent on the informal and formal retail chain\u00a0would also lose their jobs.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"3\" data-aria-posinset=\"21\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Second<\/span><\/b><span data-contrast=\"auto\">,\u00a0it would\u00a0<\/span><b><span data-contrast=\"auto\">deplete the independent entrepreneurial streak<\/span><\/b><span data-contrast=\"auto\">\u00a0that is essential for a nation\u2019s progress. Monopolies\u00a0reduce competition, strangle innovation and disincentivize smaller businesses that actually create jobs and economic\u00a0dynamism.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"3\" data-aria-posinset=\"22\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Third<\/span><\/b><span data-contrast=\"auto\">,\u00a0it would<\/span><b><span data-contrast=\"auto\">\u00a0impact\u00a0public sector banks<\/span><\/b><span data-contrast=\"auto\">\u00a0and make them lose the lucrative retail segment.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"3\" data-aria-posinset=\"9\" data-aria-level=\"2\"><span data-contrast=\"auto\">This would happen as\u00a0E-retail firms have the ability to source and provide cheaper credit to consumers.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"3\" data-aria-posinset=\"10\" data-aria-level=\"2\"><span data-contrast=\"auto\">They will dictate the terms to credit card companies and e-payment platforms to retain part of the fees collected when customers make a\u00a0purchase.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"3\" data-aria-posinset=\"23\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Fourth<\/span><\/b><span data-contrast=\"auto\">,\u00a0it would\u00a0<\/span><b><span data-contrast=\"auto\">reduce the independence of media\u00a0outlets<\/span><\/b><span data-contrast=\"auto\">\u00a0by taking a larger share of advertising revenue.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"3\" data-aria-posinset=\"11\" data-aria-level=\"2\"><span data-contrast=\"auto\">Due to their huge presence, brands will be obliged to spend heavily on advertisements to gain visibility for their products.\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"o\" data-font=\"Courier New\" data-listid=\"3\" data-aria-posinset=\"12\" data-aria-level=\"2\"><span data-contrast=\"auto\">When Google was founded in 1998, print media collected over 50 per cent of the advertisement revenue. Today, it\u2019s down to about 10 per cent.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"3\" data-aria-posinset=\"24\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Fifth<\/span><\/b><span data-contrast=\"auto\">, the\u00a0massive control over data would enable them to\u00a0become arbitrators of opinion and decide the fate of elections. This would\u00a0<\/span><b><span data-contrast=\"auto\">undermine free and fair elections<\/span><\/b><span data-contrast=\"auto\">\u00a0in\u00a0our\u00a0democracy\u00a0<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<h5><b><span data-contrast=\"auto\">Way Ahead<\/span><\/b><span data-contrast=\"auto\">:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/h5>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"4\" data-aria-posinset=\"25\" data-aria-level=\"1\"><span data-contrast=\"auto\">Europe is considering legislation to address the monopolistic behavior of big tech companies and to make data anonymous.\u00a0India can learn from this for improving regulation, enforcement and anti-trust legislation\u00a0in the country.<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"4\" data-aria-posinset=\"26\" data-aria-level=\"1\"><span data-contrast=\"auto\">Further, focus should be placed on augmenting\u00a0people\u2019s activism\u00a0that\u00a0can hold off the oligarchs from having a stranglehold over the nation<\/span><span data-ccp-props=\"{&quot;134233279&quot;:true,&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Source: Indian Express Relevance: Impact of monopolistic companies and ways to combat such monopolies Synopsis:\u00a0The technological superiority and huge capital have enabled the e-retailers\u00a0to capture a significant share of the Indian retail market. They may convert themselves into monopolistic entities\u00a0in\u00a0the near\u00a0future which may pose numerous problems\u00a0for the nation.\u00a0 Background:\u00a0 The big e-retail firms like\u00a0Jio Mart,&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/india-must-be-wary-of-monopolistic-e-retailers\/\">Continue reading <span class=\"screen-reader-text\">India must be wary of monopolistic e-retailers<\/span><\/a><\/p>\n","protected":false},"author":10322,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[],"class_list":["post-115405","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704824160},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/115405","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10322"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=115405"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/115405\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=115405"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=115405"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=115405"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}