Traditional Indian retail sector not significantly hit by e-com: Study

Only 6 per cent of these vendors attribute the closures to shifting consumer behaviour towards online shopping.

About 8 per cent of vendors link store closures to organised retail growth and 86 per cent disagree that e-commerce negatively affects the employment they generate.

E-commerce, comprising 7.8 per cent of India's trade, is contributing to employment and consumer interests, but is yet to significantly penetrate the country, allowing brick-and-mortar shops to thrive, the study report revealed.

Seventy per cent of vendors have adopted technology, with 54 per cent enabling digital payments and 22 per cent using software like Logic ERP and Tally.

Nearly 14.4 per cent of vendors are focusing on packaging and delivery skills, prompting local shops to hire for delivery roles. This adaptation helps traditional stores remain competitive.

One-fourth of offline vendors plan expansions by purchasing new stores, renovating existing ones, diversifying products, adopting more technology, or listing on e-commerce platforms. E-commerce is expanding into tier-III cities, without replacing physical markets.

Seventy-one per cent of tier-III city vendors have increased sales since moving online. E-commerce's share in retail remains 7.8 per cent, but is growing at a 27 per cent compounded annual growth rate between 2018 and 2030.

Nearly 1.76 million retail enterprises participate in e-commerce activity in the country. Pahle India estimates that online vendors generate 15.8 million jobs, including 3.5 million jobs for women.

On an average, online vendors in India employ 54 per cent more people and almost twice the number of female employees, compared to offline vendors. 

Seventy-three per cent of vendors state that tasks under management have become more digitally-enabled, while 63 per cent of vendors outsource tasks under this function. Similar trends in indirect employment generation and technological upgradation are seen for all other functions.

Overall, more than two thirds of the online vendors interviewed experienced an increase in online sales value and profits in the past year. About 58 per cent saw an increase in both.

Barring costs, vendors have seen a positive shift in all other aspects of business performance in the time since they started selling online. About 60 per cent of vendors agree that they have better market access now and have seen an increase in purchase value per customer respectively.

The impact of e-commerce on the efficiency of vendors can be established as well with 56 per cent and 59 per cent of them improving their sourcing and distribution methods and product design respectively.

Furthermore, 62 per cent of them introduced new payment options since the time they listed on an e-commerce platform.

A simple comparison between pure offline vendors and omni-channel vendors shows that the latter fare better on several facets of business performance like average purchase value per customer, sales, profits and plans of expansion.

Fifty-four per cent of omni-channel vendors saw an increase in both sales and profits in the past year compared to 39 per cent of offline vendors.

Fibre2Fashion News Desk (DS)