Corona Lockdown: Home Delivery Business Surges, But Challenges Galore

Given the lockdown happening in various States due to the Corona pandemic and people staying indoors due to social distancing, the e-commerce market has seen a major surge in demand. According to estimates shared by RedSeer Consulting, the E-tailing and hyper-local businesses in the sectors of Grocery, Beauty & Personal Care, Smartphone/Electronics, Home & Furniture, Fashion garnered 45-50 per cent growth in GMV (Gross Merchandise Value) overall in the first two weeks of March (from 1st to 15th) compared to the same period in February. 

Amongst these, the grocery and other essential segments have seen a significant surge in sales. The e-tailer m.Paani has reported their 75,000 plus grocery and essential daily needs retailers across India have doubled their sales in the past 15 days. Another online grocery shopping company Home Jiny has shared that it has witnessed 200 to 400 per cent increase in demand in the last 15 days. The leading e-commerce company Flipkart also has informed that over the last several days, they have seen demand in certain categories increase, and to meet this demand they are working with lakhs of their sellers.

With the online route being left to bring the gap between sellers and consumers, the sellers are moving towards online platforms to facilitate their sales. The social commerce platform Coutloot, which helps businesses to go online, has reported 300 per cent week on week growth, new sellers grew from 1,000 everyday to almost 4,000 new seller registrations, increase in order in terms of accessory and essential category peaked by another 150 per cent. m.Paani shared that a majority of retailers have set up online shops on its online platform recently and have achieved a 2x surge in-home deliveries.

Even if the demand may have arisen through the online route, the fulfillment of the same is inhibited due to strong lockdown across the country. The Unilever Ventures-backed Milkbasket, which earlier claimed to increased sales, is now facing asituation where their staff, vendors, and vehicles are being pushed back by the police, slowing downing the operations. Anant Goel, CEO & Co-Founder, Milkbasket, stated, "Yesterday we had to cancel thousands of orders. We could only operate at 40 per cent capacity in Gurgaon. Even lower in Noida. We might have to cancel all the orders today, impacting over 150,000 families across 4 cities."

Fashion, among the segments of non-essential commodities, seems to be most affected of all. The clothing e-tailer, Zapyle has stopped taking or fulfilling order until April 1st due to city lockdowns. The company expects a decline in sales by almost 30 per cent as of now. Another online clothing e-tailer Samshek has informed that the stores are shut and no transaction is happening and there is no growth observed in the past 2-3 weeks. As per the company, the people are scared to order at this point as the situation is getting worse and borders are sealed as couriers are not moving. Calling this situation as a downward spiral, another clothing brand Suta has seen almost 40 per cent dip in our overall sales. 

Additionally, as per the stats shared by ReedSeer Consulting, the GMV of the online businesses involving the particular segments like Mobility (45-50 per cent), Hotel-tech (60-65 per cent), Food Delivery (10-20 per cent), Movie and Event Ticketing (75-80 per cent) suffered a hit with falling GMV growth. 

Seeing the impacts of the lockdown, the Confederation of Indian Industry (CII) has conveyed its recommendation to the government to exempt certain services such as e-commerce (delivery boys and supply chain vendors) from the imposition of section 144 to enable doorstep services for citizens restricted to homes. At the time of filling the story, 75 districts across India, which includes major cities Mumbai, Bangalore, Chennai, Hyderabad, Kolkata, along with the National Capital New Delhi, are placed under the lockdown until March 31. 

Stay tuned for another update for the period covering March 16-31.