An idea whose time has come

An idea whose time has come

(Approximate reading time: 25 to 30 minutes)

Context/background

Increasing news stories about protests against the use of technology in general (and e-commerce in particular) being made by various sections of people, the latest such news story being this one.

Identifying the real target

Whether it is rickshaw-taxi drivers protesting against (and even punishing) other drivers who use technology for their own benefit, whether it is physical chemist and druggist shops protesting against online pharmacies or whether it is these traders who are protesting against discounted sales of online electronics, one theme is common: Someone somewhere is joining up in numbers to put on a show of strength and protesting against another counterpart, another peer, who has the right to use technology to expand and grow his/her own business reach. Let me stress on that word 'peer/counterpart', because Ola/Uber are not drivers themselves. Neither does Flipkart itself manufacture mobile phones (as far as I know). And I am yet to see a physical chemist/druggist store that is run directly/owned by Netmeds/PharmEasy etc. These are just online platforms, which take a cut of the actual seller/service provider's earnings in a similar way to how you would pay a mechanic regularly to keep your car in good shape, and it obviously doesn't mean that the mechanic 'owns' your car or even 'made' your car. He/she is a third-party to your car, not your peer. If that same car is involved in a crime, it does not mean that the mechanic abetted the crime just because the driver's car was running in top gear thanks to the mechanic's service.

And here, there is not even a crime being made. It is one thing to complain against the top bosses of an organization because of mistakes made by junior employees and it is another thing to complain against someone who works independently of the actual seller, someone who doesn't 'own' the seller, someone who cannot 'order' the seller and someone who didn't 'make/give rise to' the seller. These are individual sellers, drivers, etc. working on a contract basis. They don't have a fixed salary in the same way that owners of physical shops don’t have. Many of these drivers don't have their own vehicle too, just like how many shops are rented and not owned. But these drivers chose to adapt to changing conditions. Is that a mistake? They chose to work during a strike because they too need to feed themselves and their families. Is that a mistake? While working during a strike, they were able to serve customers waiting patiently for someone to show up. Is that a mistake? If these things are not a mistake, what is there to complain about? Some sellers/drivers are fighting other sellers/drivers under some or the other association's banner but they are forgetting that strength might lie in numbers, it doesn't mean that sense too lies in numbers. At the time of luring a customer, each of these traders individually try to bait the fish and when it comes to complaining/protesting about something, they suddenly try to show the strength of unity, indirectly admitting that they are incapable of facing the problem on a case-to-case basis, individually, the way they try to close a sales deal individually for themselves (and not for the union as a whole).

The more worrying aspect of the whole turn of events is not about small businesses protesting against large companies, it is about peers punishing other peers just because the latter chose to be unconventional and dared to break free from the herd mentality, refused to agree to other sellers' expectations/unwritten norms and at the same time, gladly agreed to the buyer's expectations, while still not breaking a single rule of law.

Online and offline

This particular news story mentioned above, talks about e-commerce, so let's focus on that. This protest is not the only instance either. It happened in Ulhasnagar too (link) , which itself is a notorious place for selling goods of dubious quality since before e-commerce became commonplace and in Bengaluru too (thankfully that city has been already renamed by the powers-that-be so I won't need to update this article later just for the sake of a changed name).

Not every e-commerce business is necessarily owned by a foreign entity. E-commerce has enabled many Indians to set up their own small business too, such as in terms of setting up drop-shipping stores/affiliate stores, etc. which are purely online and have no retail/walk-in counterpart. Don't forget that. In a country facing an increasingly widening unemployment crisis as well as an acute shortage of affordable land, these people are protesting against those who dared to be independent, self-employed and are occupying very little physical space of their own, just because these (latter) people are now giving competition to the former. Also don't forget that most of the large popular e-commerce players have hardly any inventory of their own, most of them are just acting as a facilitator between the actual seller (who might be another small business just like these traders) and the buyer. These traders are protesting as if those small sellers don't have a right to grow their business by taking advantage of technology. Amazon does have the whole Kindle ecosystem of its own, it sells its own products like Fire TV sticks (including in third-party stores like Croma), advertises them, etc. but that is not the main reason behind most visits to Amazon's website/app. It is simply no use of complaining against the platform itself because that would be like shooting the messenger. Both Flipkart and Amazon have loyalty programs like Flipkart Plus, Amazon Prime, etc. but that is not even meant to compete with physical shops, simply because barring some chemists who offer discounted medicines under a membership offering, very few physical shops actually have any loyalty/rewards/subscription program at all which would be applicable for all retail customers (not just known faces)! (This is just my experience, yours may vary).

The cribbing and bickering

Keeping in mind that the real ugly fight is between competing peers and not directly between small offline traders and large online platforms, it is actually a matter of shame that those people who have enough money to buy commercial real estate (in terms of setting up a physical shop/godown) are complaining about competition caused by those who don't necessarily have enough money to buy commercial real estate and might be operating out of home or a makeshift office, without any proper customer-facing shop/godown/additional manpower etc. Talk about taking your privileges for granted and talk about efficiently utilizing available resources.

It is equally a matter of pride for those small home-grown e-commerce businesses too, who didn't raise a hue and cry about competition before entering the market and took risks. They dared to compete. Now the incumbent players are feeling the heat, who were thinking that their first-mover advantage in the supply chain will last from generation to generation. It is indeed ironic that new entrants in the market don't raise such a protest about existing competition and old players (who are the ones that are actually experienced) are panicking and resorting to such measures as explained in the news story.

All foreign hands? Really?

Even IRCTC itself can be considered as an e-commerce store (and needless to say, one having very high 'footfalls'). Does that mean it is owned by a foreign entity and should be frowned and looked down upon and deliberately made to suffer losses just because it sells online? Does it mean that just because they sell online and might have tie-ups with many big names in the travel/hospitality industry, their 'rise' is automatically and by default detrimental to the business of individual, independent and small travel/tour agents? Flipkart too only recently entered into a deal with Walmart, not before that (when it was purely a homegrown success story). Since the news story in question is about an association of mobile phone traders, let's talk about that. There are many homegrown chains like Vijay Sales, Croma, etc. who sell electronic goods and are e-commerce players too, not just having a purely physical presence. These aren't foreign entities, right? Smart and shrewd business tactics say that 'If you can't beat them, join them'. Still, it is a good thing to remain independent and not give-in to being 'bought' by someone. But what is happening here?Instead of taking on the competition, these stubborn people are refusing to get online themselves (as if doing so is going to take away their independence) and they want to stay for generations in the same familiar comfort zone, using the same old tried-and-tested techniques, same old payment methods and tools thinking that they will be able to avoid risk that way. Now suddenly they appear to be realising that their survival itself is at stake, managing risks is not even a priority at this stage. So there is no question of checking "if you can't beat them" and then deciding whether to "join" them, because these existing traders have already mentally accepted that they can't beat newer players (that is what they are directly and literally saying in the quotes contained in the news story). That's what this protest actually says.

Someone's profit/victory, someone's loss/defeat

It sounds as if some usually weak cricket team such as Zimbabwe/Kenya got forced to playing a test match against a usually strong team like Australia as some kind of 'surprise/last-minute-plan' match and the former decided to declare the innings even before the toss happened, complaining using words like "Why were we made to play against a strong team"? And then naturally, they have gone on a spree of tangential bug-hunting, saying things like "Australian cricketers do sledging, they were involved in match-fixing scandals, etc. etc.", beating around the bush, without actually having defeated them at their own game in the first place. Is that how competition takes place? Even cricketers play to feed their families, right? For spectators it might be entertainment, but for the cricketers, it is they who have to handle all the pressure of expectations of fans and all the pointed questions from the media. Still, they play. Have you seen a match where the players protest and strike work just because the opposing team appeared to be too strong compared to them? Even when teams declare their innings in a test match, there are more cases of the declaration happening because of an anticipated victory instead of an anticipated defeat. And those players have at least individually thought big and passed through levels of ranking and selection in order to finally play at the international level. How many such qualification struggles have these traders faced and what individually big visions do they have?

Nature wrote the rule of 'Survival of the fittest' long before the first human was even born. It takes regular efforts to adapt to changing conditions. There is no point in acting complacent expecting that business will thrive from generation to generation without any competition. These people are thinking that INR 500 crore of losses (if at all the entire ordered inventory gets really discarded, which is highly doubtful) will really matter to CEOs having a net worth of about USD $156 billion (and of course, that is just one CEO of one e-commerce company, who still continues to receive a hefty salary and hasn't retired yet). Some people don't learn to change with the times.

Playing the victim card of 'loss of business'

Their protest sounds as if some PCO booth operators would be complaining about why mobile telephony has become so cheap today (because of which many PCO booths have shut down over the last several years). They are asking questions which sound similar to questions like "Why people today are surrendering landline telephones in hordes? We are facing loss of business in landline instruments", etc. (And this is true, a single glance at TRAI's statistics will reveal lakhs of landline telephones being surrendered every month, mainly those belonging to BSNL and MTNL). On top of that, to justify their stand, they are trying to point out defects in e-commerce, similar to how one might raise anti-mobile-phone arguments like "Customers must use landline telephones, because landline telephones (usually) don't have battery issues/loss of signal etc." How much water do such arguments hold for the actual user who is paying the price?

Differentiating needs and wants

Understanding buying behaviour is paramount to selling something, and these traders just don't seem to be getting it. Today many products are bought in an impulsive manner, not necessarily when you are 'out for shopping' with some dedicated carved-out time and committed efforts to be ready to go hopping from one shop to another. These goods and services today might be ordered at the most odd of hours, including when the weather is unfavourable or there is some or the other strike being called by unions of drivers of some or the other mode of transport, making it difficult/late to 'reach a physical place'. Pollution and traffic too are other concerns that often discourage people from going for shopping (unless they are going to AC swanky malls/places with a good ambience and a large amount of clean space). On the other hand, many shops are closed in the afternoon, and of course at night, and very likely on some particular day(s) of the week as well. Naturally, shops have a very limited window of accepting orders because they are not running 24x7 like an e-commerce store. These traders are protesting against orders being accepted by automated systems because that, the technology, is their actual show-stealer which fetches the customer who would have otherwise approached them. They are not really protesting against foreign investment in large e-commerce brands or fake goods shipped in orders. There is no use protesting against FDI in e-commerce because even homegrown e-commerce stores are going to run 24x7 and continue to take orders when physical stores can't. So all this hullabaloo about foreign ownership is just a namesake concern meant to arouse patriotic sentiments.

Time for introspection

Don't these traders themselves sell imported items (or even counterfeit/grey-market items)? Isn't money going to foreign hands in this case too? How many traders give any kind of taxable bill/invoice (which can be shown as proof for all expenses/reimbursement claims) at all to the retail buyer who does a physical walk-in? How many traders sell items which are incorrectly labelled to be NOT made where they claim to be made? On an even more serious note, how many physical pharmacy stores have a single licensed pharmacist on their payroll? How many physical pharmacy stores actually check the doctor's prescription before simply turning over the goods (thereby making a prescription medicine into an OTC (over-the-counter) medicine, which is a very dangerous act)? How many physical stores have any kind of 24x7 hotline available for customers? How many people can 'send an email to' or 'chat with' physical shops whenever the former wishes? How many physical shopkeepers understand the very, very simple fact that MRP stands for MAXIMUM retail price, which means two things:

  1. It is illegal to sell at a cost above the MRP (or even to manipulate the MRP). Some physical sellers of bottled water and ice cream immediately come to my mind as I write this. However, I don't intend to stereotype them/paint them all with one brush. I have seen honest ones too.
  2. Since the MRP is literally a maximum, it shouldn't be surprising to see someone else offering a more reasonable rate for the same item. Just because anyone else (not just online stores, anyone else) is selling something below MRP, they are doing nothing wrong. And if they think that it is predatory pricing, laws exist to deal with such malpractices.

How many traders don't flout any of the above rules? That's the key question. Give them an award if they really fulfil each of the questions asked above.

All this too needs to be checked. The small sellers and drivers who are getting online are doing so because they clearly see some value in doing so. Even those sellers who may be using their own website(s)/mobile app(s) instead of joining some popular platform, do so because they see some value in doing so. They are taking their business to where the customer is, not expecting the customer to come to them.

Out of stock and out of luck

Another important concern is availability. If the owner of a physical shop gets to sleep for 8 hours at night and still wants to sleep for additional 3 hours in the afternoon, closing the shop for the time being as a result, he/she shouldn't be complaining about missed opportunities. If the reason for closing your shop is low footfall in the afternoon, you need to understand precisely why most customers avoid shopping physically at that time. It is not only because people usually commute in the mornings/evenings. If that was the case, no restaurant would serve lunch. The point is, when customers have the convenience of ordering something right from their couch, why expect that they will brave the afternoon heat and come all the way to your shop? Some will, but not all. You will have to deal with that lessened amount of business. Have these traders tried offering any kind of shared pick-up/drop services to customers wanting to visit them physically? I have seen many real estate developers doing so. It might be unfeasible for small traders, but some shared option should be evaluated instead of simply not giving it a thought at all. If not by anything else then even by the same tempo/mini-truck which the shop already uses to load and unload goods!

Continuing on the path of availability, many e-commerce players often hold sales events that begin after dinner, terming them "Happy hour sales"/"Midnight sales" etc. That is how you have to take advantage of always-on technology. How many shops are able to receive orders at midnight? Leave aside those autos and taxis who neither get online nor readily accept passengers offline, even many chemists are not available when they are most needed. Customers will order when they want to, not necessarily when you tell them to just because you are open during specific hours on specific days of the week. A customer who braves the heat to walk in to a restaurant physically in the afternoon at lunch time does so because he/she mentally agrees that it is time to eat something, not because the restaurant said something like "You must have lunch only when I say, not otherwise". It doesn't work that way. The customer makes the decision to go to whichever open restaurant he/she wants to go to, when he/she wants to eat, not based on when the restaurant "allows" him/her in.

Many people have a tendency to shop while commuting before/after work too, and these days, in order to serve international clients better, there is a trend in many organizations to adopt a late shift which usually begins at lunch time and ends just a little before midnight. How will people working in such companies be able to place orders with physical shops while on the way back from work? It can even be a security issue, not just an availability issue. No matter how large your physical godown is, no matter whether you have the required item in stock or no, you simply won't get the order if your business is closed. And that's where machines clearly have an advantage. Simply protesting about the competition being able to fetch orders at a time when you can't, is like deliberately, wilfully and intentionally jumping in a swimming pool and then complaining that you got wet.

Driving up retail sales: E-commerce is not the only threat

Let's talk about retail sales itself. Are each of these traders really offering anything unique/spectacular or anything which is even remotely mutually exclusive between them, apart from obviously having a different physical address, name and pricing of the items? They can't expect that people will physically line up outside their stores in a line during the most odd of closed hours, waiting to give orders, like how people do outside Apple stores waiting to get their hands on an Apple product, braving the weather and testing their patience in order to flaunt being one of the first customers. Just compare the level of customer service and professionalism in Apple's stores with what these traders have. Is that difficult to understand? No. It is difficult to digest and accept for the traders, because of their stubborn beliefs. The key takeaway is, even if Apple's products are available online as well, you can still have retail buyers for the same (and of course, Apple is now a trillion-dollar company). You can make big money from retail sales too, provided you have something really exceptional to offer. This example is of an in-person shopping experience, not of e-commerce. Can these traders match it at all even after pooling in all the resources of their very fond association? Blaming e-commerce as the source of all your problems isn't going to help. Just opening a new shop offering the same items with the same level of customer service, same opening hours/days (and probably a similar amount of space as well) as your next-door neighbour and then expecting money to flow in automatically won't cut it. Demand is very difficult to predict.

In fact, in case of camera phones, it is the supply itself which created such a demand. Before camera phones became common, people were used to having separate cameras earlier as well, but it is because someone dared to merge the two devices and give something new, that now even if a feature phone doesn't have a camera, it would be considered 'out of fashion'. That is how demand is generated, whether it is something clearly exclusive like Apple's products, or whether it is something innovative like fusing a camera into a phone. What new/different/innovative things have these traders done? Just changed their pricing (compared to their nearest competitor) for offering exactly the same item, same service, same availability, same welcome drink, same WiFi for guests and maybe even the same song playing in the background? Merely being an 'also-ran' isn't going to cut it, especially when you form some kind of 'union' and decide that all shops selling something/involved in a particular trade must compulsorily be closed during specific day(s)/hour(s). Invoking such an unwritten rule and treating it as some kind of law directly kills the independence associated with owning your business and making your own rules. When the physical sellers have simultaneously decided to refuse business at certain times, naturally the order will go to the online seller, simply because even if the online seller has no employees or might be sleeping/(god forbid) ill himself/herself, there is a machine (and often, backups/clones of that machine) ready and waiting to accept the order and set the wheels rolling.

Why technology puts immense power in the hands of a small business

Just think about it, the small seller who probably cannot afford to hire store-front showrooms/additional manpower, probably has no inventory as well, is still able to accept orders at a time when offline traders having showrooms and manpower, cannot. Why? Technology. Is this so difficult to understand? Employees have to be given weekly leaves as per law (and a limited amount of working hours per day), but not machines. This is common sense. Earlier it was the case that electricity was not readily available but today (shortages of both, conventional and renewable fuel kept aside), electricity is readily available in most urban areas to keep machines (as well as Internet connections) up and running 24x7. This change in time has been grossly neglected by some traders.

Worried about competition? Or wanting to have a like-minded monopoly?

It is ironic that many of these physical shops are located almost next to each other in clearly marked out 'bazaar' areas and localities of towns. Even in big metros such as Delhi and Mumbai (which are obviously much bigger cities than Surat), there are certain areas known for having scores of shops selling electronics. At the time of booking their shop's space, their own competition is right next to them before their own eyes and now suddenly they are protesting against increased 'competition' causing loss of business to them? What are they thinking? Are they thinking that only those who can afford to buy shops have a right to do business? The real protest is against technology, against changing with time, against the lowered entry-barrier to doing business in case of e-commerce.

Treating the customer as a king/queen

Most of the large e-commerce players at least understand the value of going where the customer is. However, in many areas (not just in Gujarat) some physical shops are way too adamant on their afternoon siesta as some kind of birth-right. Even jokes are shared about this 'convention/tradition'. They will refuse to open the shop in the afternoon even if there is a paying customer ready to give an order, just like how many rickshaw-taxi drivers refuse passengers who are ready to pay even when it is clearly not meal-time for the driver. Naturally the customer will go to something which is available 24x7 at the press of a button (and might even pay more for it). Who made the mistake and whose loss of business it is? This has to be common sense.

Warning signals ignored time and again

The whole foreign-ownership factor is just a mask being used to put on a show of fake patriotism. Let's take an example of how domestic business can thrive. And since Gujarat traders are in question here, let me take Reliance as an example. With the turn of the century, cyber-cafes sprang up in a lot of places, trying to take advantage of the dot-com boom. Within a couple of years, that bubble burst, mainly because of a lack of suitable infrastructure which didn't really get a lot of people to use the Internet for serious work. After that, Reliance Communications entered the telecom market nearly 16 years ago with DAPO (Dhirubhai Ambani Pioneer Offer), it created lots of employment (I should specify, domestic self-employment, an excellent turn of events) with plenty of new small stores springing up, acting as franchises. Reliance had no prior experience of providing mobile telephony, still, their telecom service became the hottest thing to buy at that time. Most of their phones didn't even have a SIM card and likely wouldn't be compatible with other operators, but still people flocked to buy them. That itself should have been an early warning signal (to these traders) about consumers shifting towards online transactions, because that whole DAPO package was really encouraging people to make use of the Internet, especially in terms of the data-enabled handsets of that time and their R-World offering, much different from whatever WAP/GPRS offerings the incumbent players were providing at that time (with a SIM card that could be used in many handsets). Users started becoming used to surfing the Internet to access things like plaintext news, simple games, check email, cricket scores and so on. Later on, many of the services being offered in R-World became "Pay per entry"/"Pay per use", including some games. This set the adoption trend for m-commerce more than a decade ago. The traders in question don't seem to have learned a lesson since more than 15 years. Unbelievable resistance to change. A human baby born during Reliance Communications' entry into the market would have likely cleared his/her secondary school today (and learnt plenty of lessons in the meantime, possibly including how to cycle, how to swim, and of course, basic computer skills) but these traders haven't learnt one lesson in all these years. Talk about upskilling employees when the employers themselves haven't skilled up.

A few years after Reliance Communications' entry, wired broadband (whose definition might be debatable) became commonplace in urban areas. After that, 3G became available nationwide and after that, especially in the last two years, digital payments received a big push, banking accounts themselves received a big push (I am not talking about the interest rates but about the tendency to conduct transactions via a bank account instead of hoarding physical cash) and there were concerted efforts by many players in the e-commerce space to assure buyers about the safety of doing online transactions. In the more recent past, 4G services became extremely affordable, with a big focus on data instead of voice. All of these events have already taken place. Let me repeat that, all of these events have already taken place. Now these traders are panicking when the high tide has turned into a tsunami, simply because they refused to pay any attention to early warning signals, remained off the loop in their own closed circles and were blindly expecting to rake in high sales during the current festival season, without keeping in mind what they have ignored already, just because they were expecting similar business as to what might have happened one full generation ago. Even mobile phone services did not exist in India one generation ago. What sales traditions are they expecting to continue? Typical stubborn resistance to change.

Self-goal in placing 'orders' at e-commerce sites

You know the irony behind all this? These people are able to cause some loss to e-commerce players precisely because it is very easy and convenient to order something online (especially when opting for cash on delivery). How would have these people even done that if these were physical stores? How would they have protested if they weren't even allowed to place orders so conveniently? It is precisely because of the automated nature and scalability of e-commerce systems that such a huge amount of orders could be placed at all. Try placing orders worth 500 crore Rupees with your neighbourhood shop (or even a collection of neighbourhood shops). It is pretty obvious how powerful technology can be. The same technology can be used by these traders too, it is neither rocket science nor does it cost a bomb. In all likelihood, at the risk of making a few assumptions about their business, it costs less per year to do that, than the monthly salary of one of their staff members (and I am not even factoring in the additional revenue generated because of the online sales). You don't even have to study a lot for it. Many of these sellers and taxi drivers who have signed up on e-commerce websites and mobile apps do not possess any formal training in technology, but they at least chose to change with the times.

Rebel without cause and the real rebel

Compared to this peer v/s peer protest, a more sensible protest might be of the drivers protesting against low earnings and incentives ( link ). However, just like they too are not entitled to a fixed salary as contract workers, similarly, these traders need to understand that their own businesses are not entitled to any fixed amount of business irrespective of whether it is festive season or not. The drivers protesting against lower earnings are doing so by comparing a relatively recent situation of business to the situation today (without receiving enough warnings in the meantime) whereas the traders are protesting by comparing what was the norm more than a decade ago to what is the norm today (even after receiving plenty of warning indicators as mentioned above). And still the online drivers are being beaten up by a section of other online drivers just because they chose to work during a strike. Talk about the fundamental right to having a 'living' wage. The ones who are offline need to understand that all is not well with those who have gone online as well. After all, this is business. Success is not guaranteed, but nothing stops you from reducing your chances of failure (as long as you don't break the law).

Competition: Really international?

Take the same telecom example as mentioned above. These traders are arguing that some foreign, well-funded players in e-commerce are benefiting at the expense of small businesses. The reverse happened in case of Reliance Jio's entry into Indian telecom. A domestic business (Jio) was started in a very radical way, not just in terms of pricing but also in terms of having a 4G-only network. The competition that it created not only resulted in a price war bringing down prices by as much as 97% and making India have the cheapest 4G plan in the world, but also it forced Vodafone and Idea to come together (and it is actually Vodafone who is a long-time multinational player, not Jio). These traders, especially being from Gujarat, need to really learn from how Reliance grows domestic businesses and always stays ahead of the time. You need to have a long-term vision, especially when you are planning to handover the operations of your shop to the next generation (On this note, don't forget that both Reliance Communications and Reliance Jio arose after Dhirubhai Ambani's death). After Jio's entry, plenty of controversies arose about incumbent operators not providing enough POIs (points of interconnection) to Jio. However, the simple truth is, Reliance Communications is almost non-existent today (having a market share of just 0.004% as per latest data available with the TRAI , page 6) and Reliance Jio is the world's largest data network based on data consumption (as per Jio's website) as well as India's largest ISP (as per latest data available with the TRAI, page 13) , in spite of not offering any 2G/3G services. At the same time, using their existing strengths, Vodafone Idea limited (as the new company is named) is now the biggest telecom operator in India in terms of number of total subscribers. That is how you change with the times, that is how you compete, that is how you adapt to market conditions, without complaining about 'foreign' players in the market. Now just because Vodafone and Idea were small players before Jio's entry (relatively smaller than Airtel too), it doesn't mean that Vodafone and Idea should accept defeat and leave the telecom space (or even worse, get acquired by Jio, thereby risking the creation of a near-monopoly). You need to stay there and learn how to compete, you need to assess your strengths and weaknesses and use them to your advantage.

Of course, in the process, Vodafone and Idea both had to lose some of their independence, but what they gained, was a much more practical move compared to telling its staff to deliberately jam Jio's network with a large amount of unsolicited traffic. If they had done such tactics, that would sound very cheap, and that's exactly what these traders have done by posing as customers in such an organized large-scale manner. Vodafone and Idea at least let go of their arrogance and the former competitors joined hands to tackle the competition, when will these traders think big? Why is their so-called 'association' (of which they are very proud of fighting under) not working together as one unit here? Vodafone, Idea et al might have been alleged of not providing enough POIs to Jio, but they did that in the case where Jio was directly their competing peer as a service provider and it wasn't the case as if Jio was the first one to roll out 4G. It was Airtel who first launched 4G. It wasn't the case as if incumbent providers (barring MTNL and BSNL) are too adamant to change with times. All private players had done something or the other new over time (Vodafone was even earlier known as Hutch which was still earlier known as Orange). It wasn't the case as if some group of customers of Airtel/Vodafone/Idea punished Jio. Even after all this, Jio continues to gather more customers per month than everyone else combined (as per latest data available with the TRAI, page 6). Did all that alleged POI arm-twisting by incumbent peers really hold up Jio's growth? No, it didn't. In the case of this news story, a platform is being targeted by posing as customers, whereas the losses are happening on the actual seller's end too, not just with the platform, all because the latter did not have a resistance to change. It is cowardly that sellers have to pose as customers in order to settle scores instead of competing as 1 seller v/s another seller as players do in a game of chess. These traders have been in the supply chain for a long time, they know that all those relationships are built on trust. If they had dared to order all these goods in such a large amount as a seller itself and then refused to accept them, their reputation would have been in shreds. Hence they are meekly and timidly hiding behind the mask of 'customers' placing 'orders'. They know very well that most e-commerce companies treat the customer as a king/queen (which is actually the latter's own advantage, difficult for the former to accept and implement), hence, in order to be able to afford the luxury of refusing delivery, they are posing as customers. This is a big self-goal for offline traders.

Not cash, but refusal on delivery

Now let's talk about the 'cash on delivery' mode of payment, which encourages many people to opt for delivery of goods from an e-commerce store. There are many offline businesses who accept orders and bookings over the phone and provide home delivery of goods and services. They don't necessarily expect payment in advance, they accept cash on delivery as well. In fact, they don't necessarily even have an online presence. Just take small restaurants for example. Not every restaurant is listed on Burrp/Zomato/Foodpanda/Swiggy etc. But it is likely that they too might be providing home delivery of food when ordered via telephone. They are very likely to be homegrown small businesses having no 'foreign hand'. They aren't necessarily multinational companies. Similarly, the actual sellers who ship products using large e-commerce platforms are often independent of the platform itself and are not large multinational players. Is placing orders with such businesses and then canceling them, any solution to the problem just because they are getting more orders than you? No, the simple and bitter truth is, technology, combined with the management of large well-organised businesses, has got the better of some traders; those traders, who blindly believed that their success is guaranteed to be permanent or as if only 'their' kind of people have a right to do business.

In the news story, it is being talked about that the traders are trying to inflict packaging and shipping losses on the e-commerce brands. Once again, they have failed to realize that not every order is packed/fulfilled by the platform itself, it is often done entirely at the seller's end, at the seller's expense and risk, to be precise, their own peers who simply decided to take their business to where the customers are. The way these traders are protesting about their 'loss of business', I wonder what should those unemployed people do who have actually lost their respective jobs to automation and have no business to depend on. Did these traders enter business thinking that it will be a walk in the park/a bed of roses?

Food for thought

Think about it. Everybody has a right to do business, and self-employment always has to be encouraged. Competition is just a natural by-product. Doing business is not supposed to be some kind of exclusive privilege of a select few traders who have the money, manpower and materials to have storefronts and warehouses since decades. There is at least plenty of competition in the e-commerce space, which is always good for customers. There is no monopoly here. If there is an Amazon/Flipkart, there is a PayTM Mall/Infibeam/Snapdeal etc. If there is a MasterCard/Visa, there is a Rupay. If there is a Foodpanda, there is an UberEats. If there is Netmeds, there is PharmEasy. If there is an Ola, there is an Uber. If there are those who have websites, there are those who have gone app-only (and still others who have separate apps for tablets as well). There is simply no monopoly. There are many other areas in which certain players have a near-monopoly. Have these traders looked at the near-monopoly of imported electronics in their own inventories? Isn't that something to be worried about? Where did their patriotism go here? The disturbing truth is, these traders are more worried about competition than about the dangers of a monopoly. It is common sense to understand which of these is good to have and which is bad to have, keeping yourself in the shoes of a customer. Having a physical store might be necessary for providing some kind of 'experience zone' to customers, it doesn't mean that it will automatically and necessarily generate sales too. When even the non-living electronics items being sold themselves usually come with only a 1-year warranty (and not even that much in the case of most used goods), how are traders expecting business (which is inherently alive and risky) itself to be guaranteed year after year? Time and tide wait for none. These traders try to sweet-talk the customer about offering warranty on their sold goods and forgot to repair their own business while sleeping in the afternoon.

Vivek Singh

Principal Developer at Nomura | Ex - Morgan Stanley | Java Developer

6 年

So many excellent points put together in the right direction. Instead of protesting and eventually fading in dust, they should start adapting to inevitable force with which technology is driving almost everything in real world.

Sunil Chellwani

Lead Software Engineer at Worldpay

6 年

Exactly...This is what I tell shopkeepers when they crib about E-commerce websites.. "Why are you Not going Online too" and they they have No Replies :) and? when I explain them how E-commerce works & then Ask them "These sites too have retailers like you so How E-commerce site is responsible for your decline in business" and they still have No Replies :)

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