- As many as 1.5-2 million
MSMEs like manufacturers, wholesalers, retailers and distributors sell online. - By FY27, they are expected to drive eTailing sales to the tune of $50 billion.
- For now, large brands who make up 5-10% of the e-commerce ecosystem drive 75-80% of the industry sales.
Large brands and companies who make up 5-10% of the e-commerce ecosystem drive 75-80% of the GMV. Meanwhile, medium sized companies make up for 15-25% of sellers yet contribute to only 10-18% of GMV. These sellers are both manufacturers and distributors. Small-scale sellers make up for 70-75% of sellers in the system, with a 5-10% share in GMV.
MSMEs are on a growth path and expected to grow faster than the industry’s compounded annual growth rate (CAGR) growth of 25%. They are expected to grow faster than the industry to drive eTailing sales to the tune of $50 billion by FY27.
“By adopting online distribution and sales channels, MSMEs are capitalising on the benefits of increased revenues, better customer understanding, and reduced costs,” says Redseer.
E-commerce companies are adapting policies to support MSMEs, offering zero/lower commissions, larger user bases, better pricing on logistics, seamless onboarding, effective marketing tools, and powerful seller dashboards, Redseer said.
MSMEs in fashion, BPC see good traction ‘online’
A survey by Redseer of around 250 non-grocery sellers indicated that in the first year of these sellers’ operations on eCommerce platforms, online revenue accounted for one-third of total sales. But by the third year, the share of online sales exceeded 50% of the total sales.
“MSME sellers in a few prominent online categories such as fashion, beauty, and personal care saw an increase in net profits after they began selling online,” said the report.
Around 96% of the MSMEs surveyed across these categories reported an increase in their total net profit after implementing an online sales channel. More than 55% of the sellers across these categories, with a turnover of more than ₹1 crore per annum, reported a net profit increase of more than 15%.