Why this is important to Wisconsin businesses: Both the business-to-business and the business-to-consumer markets are growing rapidly.
The online business-to-consumer (B2C) market in India was valued around $23 billion in 2015, and is expected to reach $100 billion by 2020. India is expected to surpass the U.S. with over 400 million internet users by 2016, second only to China. Mobile commerce is growing rapidly, and could eventually contribute up to 70 percent of industry total revenues.
The $100-billion-plus U.S. e-commerce giant Amazon and is is among the top e-commerce players in the country, along with Indian companies like Flipkart and Snapdeal. U.S. retail giant Walmart is also looking to partner with the leading e-commerce companies in India.
As the B2C e-commerce market in India is witnessing phenomenal growth, the business-to-business (B2B) market has also shown huge potential in the country, and the average B2B transaction is around 2.5 times bigger than the average B2C transaction.
The B2B e-commerce industry in India is currently valued at $300 billion, and is expected to reach $700 billion by FY2020. The global B2B e-commerce market is expected to reach $ 6.7 trillion by 2020, dominated by China and the U.S.
Unlike B2C, 100 percent FDI is allowed in B2B e-commerce, thus attracting multinational giants such as Walmart, which has launched its e-commerce portal BestPrice. In addition, Alibaba is looking to make a big entry into India via One97 Communications, which owns Paytm, and Amazon is preparing to launch an online B2B portal this year that will target clients from other active B2B companies in India, such as Bizongo, Industrybuying.com, Mjunction, Moglix, Power2SME and Tolexo.
India’s estimated 40 million online shoppers today are expected to reach 250 million by 2020, and these shoppers buy across borders. The U.S., China, the UK, Singapore and Japan were the top five source countries for Indian shoppers’ online purchases, and these purchases on average are higher in price than domestic purchases.
The attraction of major investment in the sector, as well as changing consumer lifestyles, population growth, rising income level, increasing internet penetration and scarcity of organized retail, have given a boost to the e-commerce business in India. B2B e-commerce players have to develop strong business and logistical connections with exporters, businesses and banks to ensure smooth delivery. Ample opportunities exist in India’s e-commerce industry for overseas merchants, sellers and manufacturers.