Not more than 25% Of E-commerce sales should retain for a single vendor

This is another blow to the traditional structure of the E-commerce companies in India. To keep in simpler terms the FDI is allowed and legal only into the Market place led E-Commerce but not on Inventory led E-commerce. The Inventory led E-commerce is something the E-commerce companies will maintain a warehouse, buy products and sell them on their websites to the customers whereas the Market place led structure is something where the E-commerce websites stands as a bridge or intermediate between the seller and buyer. In India, mostly all the E-commerce structure is Inventory led model, though they don’t use their names. For instance, the biggest seller on Amazon is Cloudtail, which is a joint venture of Amazon and Infosys Narayana Murthy on other hand WS retail is the biggest seller on Flipkart whose roots are again on the name of Flipkart only. This two sellers comprise of more than 55% of total sales on the website. The new policy might not allow this anymore. However, there are some strong reasons behind the inventory led model as the market place led model might not give customer satisfaction every time. Though the big market giants haven’t commented about this policy, it is sure going to be structural change in the business model of E-commerce industry in India.