Grocery also dotcom: Uttar Pradesh will become the first state in the country to join ONDC on June 27, your neighborhood shop will also be online now
Jay Prakash, 35, a resident of Bangalore, inherited his father’s departmental store. The store had a large and reliable customer base in the affluent apartments known as the Diamond District. Rice, pulses, bread and fresh produce were sold in this 400 sq ft store. It used to earn about 15 thousand rupees daily. But this was before the pandemic. People started living more in homes and started ordering things online. People are loving the service that promises delivery in less than 20 minutes.
Prakash’s daily income has halved. The old customers who knew about the quality of the goods are still attached to them. But everything was not the same as before. Quickly opening an online store, designing a website, spending on marketing and building up a delivery fleet was a major challenge for Prakash. But the new initiative of the central government has given hope to their two decade old business.
In fact, to give equal opportunities to people associated with online and offline business and to reduce the dominance of American tech companies, the government has come up with a solution. Which enables all types of sellers to showcase their products in the shopping app with major retailers. It is called ONDC (Open Network for Digital Commerce). The system will allow offline retailers to compete with larger online retailers, including the many fast grocery delivery services that have emerged over the past year.
In this new system, customers will be able to open their preferred shopping app (when linked with ONDC) and find products from all the vendors that are part of ONDC. These will also include local and nearby stores. On June 27, UP will become the first state to join ONDC. This will include the ODOP product of Lucknow. Later products from other states will also be added. Food and grocery items have been kept in the pilot project.
Soon this service will be used for other commercial products as well. According to reports, tech giants Google and Amazon are also in talks to join it. That is, when customers open the Amazon app, they will be able to buy from any seller registered with ONDC.
Unusual solution to the basic problem:
An era where online giants and Big Tech have captured the market. In that case this solution is unusual. The government is making a protocol to bring all types of retailers under one roof. Earlier, a protocol was also created for UPI (Unified Payment Interface) which allows real-time bank-to-bank transfer through a smartphone app. Over 600 crore UPI transactions took place in the country last May, which shows the potential scale that the government can achieve by creating technology tools for businesses.
T. Koshy, CEO, ONDC says, “We have found a smart solution that is participatory, fair, inclusive and democratic. Indians have an average age of 29 years and the second largest population in the world and also the youngest. They don’t have time to buy because of huge packages and high pressure jobs. Hence the number of online delivery services is increasing. But the ONDC protocol can prove to be helpful for offline retailers. They now have a platform to compete with startups with big pockets. ONDC will help vendors succeed based on the scale of their offering and expertise, says Koshy. Not the scale that helps many startups achieve funding.
However, Prakash completed his first order on ONDC in the form of instant noodles and coffee. Their orders are gradually increasing, but Prakash is optimistic about the changes to come. They are sure that ONDC will get their business back on track…as it was before the pandemic.
Grocery delivery market will grow 15 times:
The instant grocery delivery market has grown exponentially in the last one year. According to research and consulting firm RedSeer, it is currently worth more than Rs 5480 crore, by 2025 it will increase by about 15 times to reach Rs 43 thousand crore. Due to this, it will be ahead of EU and China. Ultra fast online delivery has gained momentum in the US and Europe as well. Glovo in Spain, Gorilla in Germany, Cashew in France and Zap in London are recent examples.
100 cities, one crore businessmen will be added
The government plans to connect 3 crore vendors and 1 crore traders with ONDC by October this year. It will be expanded to 100 cities. Industry experts believe that online commerce has affected the industry, but now it is going to define business in a new way. ONDC will be important in this. Retailers Association of India CEO Kumar Rajagopalan said that ONDC will give a new dimension to the entire segment. Indian customers do a lot of searches online for shopping. If their trusted store owner is online, they will definitely switch over.
