India’s eB2B market may grow to USD 90-100 billion in gross merchandise value by 2030 from USD 50 billion in 2021 on the back of massive penetration and multiple favourable factors, according to a report.
The report by strategy consulting firm Redseer also forecasts that the B2B (business-to-business) retail general trade opportunity in India will reach around USD 1.2 trillion by that time with eB2B taking up a 8 per cent share.
eB2B has already captured a fair share of the offline market, and retailers are confident about increasing their spending soon, it said, suggesting that some 50 per cent of the non-users are willing to shift to such platforms in the coming year.
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, Redseer said.
One of the fastest growing business segments in the world, the domestic eB2B market comprises multiple players who differ in terms of their city presence and the range of retail categories they cover.
“Retailers, brands and manufacturers have realised the eB2B market’s potential and are betting on it to shape the way they do business. While manufacturers have limited competitive threat, the eB2B channel is also helping retailers and brands solve multiple problems in their day-to-day business,” Mrigank Gutgutia, Partner at Redseer Strategy Consultants, said.
“India’s eB2B market has scope for multiple models but, multi-category play with wide category coverage and national coverage is likely to win. eB2B is projected to reach USD 90-100 billion GMV (Gross Merchandise Value) by 2030, owing to a humongous opportunity,” he stated.
While the regional market is generally restricted to metros and top tier 1 cities, the national market implies a presence across the country, as per Redseer, which also said that owing to higher opportunity size, adoption and engagement, multi-category national players are best placed to win in this market.
In India, unorganised general trade channels drive the bulk of retail and will continue to drive it in the next decade. A large pool of around 13 million retailers drive this general trade opportunity, majority of which are small-scale and concentrated in the tier 2+ markets, it said.
According to Redseer, while this market is at an early stage right now, given low adoption in lower city tiers and small stores, eB2B is emerging as a strong digital procurement solution.
eB2B platforms have been able to effectively resolve some of the pressing pain points such as higher prices, no credit option, untimely delivery, and low quality of products, among others, it stated.