Lockdown relaxation: E-commerce firms see demand for non-essentials rise manifold

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Published: May 6, 2020 2:30:50 AM

Consumer demand for non-essential products with e-commerce firms has increased manifold after the government last Friday lifted the ban on sale of such products by e-tailers.

Amzon is seeing a demand for various kinds of smart devices, products related to electrical appliances, work-from-home enablers and clothes.Amazon is seeing a demand for various kinds of smart devices, products related to electrical appliances, work-from-home enablers and clothes.

Consumer demand for non-essential products with e-commerce firms has increased manifold after the government last Friday lifted the ban on sale of such products by e-tailers. Anil Goteti, senior vice-president at Flipkart, told FE that the firm is seeing an increase in searches for products such as laptops, consumer electronics, mobiles, air-conditioners, coolers and T-shirts. “We are working with lakhs of sellers and MSMEs across India and helping them prepare their businesses to make products available for consumers,” Goteti said.

Online services marketplace Urban Company (formerly UrbanClap) said home services (cleaning, maintenance and repair facilities) accounted for nearly 60% of the orders while beauty services (for both men and women) made up the remainder. To cater to the surge in demand, Urban Company is hiring professionals for men’s haircut and grooming. Problems related to getting passes and requisite permissions for movement, nonetheless, persist, the firm said.

Amazon in a statement to FE on Monday said the firm is seeing a demand for various kinds of smart devices, products related to electrical appliances, work-from-home enablers and clothes. Snapdeal said about 90% of the sellers in the orange and green zones are expected to become fully operational through the course of this week. However, given the order backlogs, deliveries are estimated to resume speed gradually. The company is delivering non-essentials in cities like Gurgaon, Amritsar, Goa, parts of Gujarat, select towns in Rajasthan and a handful of cities in South India.

The process of dispatching orders in hilly areas like Shimla, Solan and Mandi is underway.
In a notification issued on May 1, the ministry of home affairs (MHA) permitted e-commerce firms to resume shipments of non-essential items in orange and green zones. Smartphones and electronic items typically form the bulk of orders services by e-tailers.

Satish Meena, senior analyst at Forrester Research, said although demand for products, particularly laptops, books and smartphones, are expected to see an uptick, deliveries by e-commerce firms initially will take one to two weeks given the operational challenges, including inadequate availability of manpower.

The market research firm has slashed its growth forecast for the sector to about 5%-6% for CY2020 against the previous forecast of 26%. The e-commerce sector grew at an estimated 28% in 2019. The recovery for companies from 40 days of restriction on non-essential shipments will take time and may not be in entirety as consumers are likely to cut down on spending and stick to need-based purchases amidst pay cuts and job losses, Meena said.

According to a report released by Forrester Research in March, e-tailers are expected to take a hit of at least $1 billion in gross sales due to the lockdown that limited deliveries to essential items. The report has then captured the impact of the initial 21-day lockdown period.

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