Online wholesale marketplace Amazon Business has completed four years of being a platform of trade for MSMEs. Through this tenor, it has seen an increase of 39% in monthly users and also catered to Tier-II and III markets with a 30% and 25% customer base, respectively. During the pandemic, the company also kept its employees safe by creating a dedicated COVID supply.
According to a report by IBEF, MSMEs sector in India increased by a CAGR of 18.5% from 2019 to 2020. In the Union Budget 2021, the Government also announced funds of Rs.10,000 crore for ‘Guarantee Emergency Credit Line’, which act as a major boost to the sector.
On this occasion we talked to Suchit Subhas, Director, Amazon Business, to gain an insight on new partnerships, business enhancement and innovation.
How is Amazon Business helping MSMEs for all their business procurement needs?
Since its launch in 2017, Amazon Business has always aimed to empower MSMEs as a one-stop destination with over 15 Cr GST enabled products across top categories to cater to their distinct business needs. Coupled with a strong delivery network that has a presence in 99.6% pincodes in India, our focus has been to simplify purchasing for businesses and help them reduce cost to improve profitability.
There are over 4 lakh sellers selling to business customers on Amazon Business. By partnering with our sellers, Amazon Business has also launched stores relevant to the different needs of businesses such as WFH store, Distance Learning store, Commercial Store, Bulk Store, Corporate Gifting Store, Weekly Essential Store, Covid Supply store, amongst others. This has helped MSMEs leverage a single consolidated destination to access a wide range of products to cater to their various needs of creating a safe work environment and ramping up operations.
In the last four years, in addition to becoming India’s largest GST store, we have added a host of features such as multi-users account feature to enhance account security and compliance, bulk purchase features, shared payment methods and business analytics tool. Through these features, businesses are able to further make their purchases more efficient and save more.
Have you adopted any new technologies/innovation to help businesses? Please throw some light on it.
We recently launched Business PAN as an additional license type through which MSMEs with annual turnover of less than INR 20L, Education Institutes and NGOs can register and avail Amazon Business benefits. To help businesses adjust to the new normal and run their businesses remotely in the work from home setup, we launched ‘Bill to Ship to’ feature. Through this feature, we have taken a lead in solving a unique customer problem and offered a solution which allows them to claim GST credit on their billing address for their pan-India shipments. This convenient feature allows customers to consolidate the tax credit to one state and make use of GST credit more effectively. To ease the registration process, we launched a simplified registration experience through which a business customer can create a free Amazon Business account in less than two minutes and start shopping.
Along with technological innovations, we have also innovated in our customer experience to help businesses save more. One such innovation has been the launch of “Business Value Days”, a monthly sale event on the last week of the month through which our customers have availed more than INR 7.5 Cr additional savings on business exclusive deals and promotions.
Are there any special deals and offers on the account of the four-year anniversary of Amazon Business in India?
On account of its four-year anniversary, Amazon Business plans to run an ‘Anniversary Sale’ from 24th to 29th September, where customers can avail up to 20% cashback 1 on orders above INR 1500/. We also have multiple deals across different product categories like laptops, printers, televisions, office furnishing, kitchen products, work from home and study from home essentials. In addition to these business exclusive deals, businesses would continue to save more with GST input tax credit and bulk discounts as part of the anniversary special offer.
Tell us a little about the growth and expansion Amazon Business saw in the last four years?
In its four-year journey, Amazon Business has registered millions of businesses as customers in India and has continued to see an exponential growth, with a CAGR of 102% in customer base, making the Indian marketplace of Amazon Business the second biggest after US. We have seen a 39% increase in monthly active users, resulting in 69% increase in orders and 85% increase in sales. We are also encouraged that we have been able to cater to businesses from smaller markets as well and have seen 30% buying customers and 25% orders from tier 2 and tier 3 cities.
For our sellers, Amazon Business has helped unlock a new customer segment to grow their B2B business, an avenue which most of our MSME sellers have never forayed in the past. In addition to catering to MSME customers, our sellers have also catered to requirements from large enterprises such as Mahindra, GE, Tata Group. For most of our sellers, this was the first time they worked with such large companies to meet their procurement needs.
We started our journey with 14K sellers in 2017 and have seen that base grow to over 4 lacs sellers offering 15+cr. GST enabled products. Through our feature, ‘Request for Quantity Discount’, launched in Feb’19, our sellers have catered to lakhs of bulk orders from businesses across the country. We recently launched the commercial store with thousands of products across top categories such as business laptops, networking devices, industrial adhesives, tools and equipment and safety and security across top brands such as Lenovo, Cisco, Pidilite, Kimberly Clark, Stanley Black and Decker, Kirloskar.
Share some insights on how Amazon Business is helping businesses get back on their feet from the Covid-19 pandemic?
As we strive through challenging and unprecedented times, we are humbled to see how Amazon Business has played a crucial role in enabling and supporting small businesses in India to get back on their feet in the last 18 months.
Over the past one year, we have been closely working with our selling partners to help businesses cater to their work from home needs by adding thousands of products across categories such as WFH furniture, electronic essentials like routers, headphones, keyboards and office stationery.
We are committed to helping and supporting organizations and their employees to stay safe by providing them instant access to various safety products required for their offices and workplaces. We have focused on adding a host of supplies for workplace sanitization by creating a dedicated COVID Supply Store through which businesses can buy a range of essential products like PPE kits, masks, face shields and sanitizers.
It has been our continued effort to empower businesses to navigate through such challenging times by helping them become more efficient and reduce their cost of procurement. To help businesses with incremental savings opportunities, we launched B2B focused events such as MSME Accelerate, an event to help small businesses kick start their operations post the lockdown. In MSME Accelerate, we saw participation from over 3L sellers, configuring business exclusive deals and bulk discounts resulting in +30% increase in buying customers and 35% increase in orders. Additionally, our monthly business event, Business Value Days continues to see significant growth in participation from customers and sellers. Each sale has seen over 5K curated offers which has resulted in over crores of savings for businesses.
Going ahead, what are the future plans for Amazon Business?
We see a significant growth opportunity in the future. We will continue to build on our three strategic pillars of growth – Selection, Pricing and Convenience. Our focus will remain on increasing our selection bringing in top brand launches, exciting business deals for bulk purchases, and new innovations for customers.
Reports suggest that GMV will reach almost twice this year as compared to last year, especially during the festive sales. Logistics and fulfillment comes into play with this surge. How does your company ensure faster and safer deliveries?
We continue to remain customer obsessed and are very focused on building the right customer experience right from day 1. Our continued investment in infrastructure expansion and technology, helps lakhs of sellers with the access to a much larger customer base, and serve higher customer demand during the festive season. Amazon India has ramped up its delivery infrastructure and has close to 1700 Amazon owned and partner delivery stations delivery stations and added tens of thousands of delivery partners to its network. Amazon.in expanded its fulfilment footprint with more than 60 fulfilment centres in 15 states offering a storage capacity to offer over 43 million cubic feet to sellers across the country. Further, Amazon India has sort centres across 19 states across the country to ensure faster and reliable delivery.