Coronavirus Outbreak: The pandemic spells big opportunities in e-commerce and logistics

Correspondents in the e-commerce industry believe that the transaction volumes in verticals will be higher than the pre-COVID levels by September 2020.


The exponential growth experienced in internet infrastructure has been at the heart of the e-commerce boom in India. One look at the increasing internet penetration explains the rise in the retail sector that has only strengthened the foundation of e-commerce needs. The market was further solidified by friendly government policies, which include 100 percent foreign direct investment in B2B e-commerce.

However, the outbreak of the global coronavirus pandemic has changed industry dynamics in a jiffy. Even though the spread of coronavirus has impacted several industries such as travel, restaurants, and cab services, it has proven to be a boon for e-commerce companies. According to research, 52 percent of consumers are avoiding crowded marketplaces and are leaving their houses a lot less due to COVID-19. Additionally, the intensive physical distancing measures and development of contactless payments/delivery models has resulted in a shift in consumer behaviour. As a result, e-commerce payment platforms are expected to grow by up to 25.9 percent in 2020.

 Coronavirus Outbreak: The pandemic spells big opportunities in e-commerce and logistics

E-commerce players would be better off partnering with logistic players who strive for optimal utilisation of their fleets. Image: Pixabay

One of our recent surveys further corroborated this analysis, as 92 percent correspondents in the e-commerce industry believe that the transaction volumes in most verticals will be higher than the pre-COVID levels by September 2020. This speaks volumes about the positive growth trajectory that will be brought on in the digital space.

On the horizon

The future of e-commerce looks bright and exciting, as a lot of new industry verticals are hopping onto the bandwagon, making every product and service available online. Fast-growing economies such as India will witness increased growth due to higher internet penetration and data speeds.

E-commerce will also benefit micro, small, and medium (MSMEs) by expanding their scope of market reach, by overcoming geographical restrictions and competing with larger players in the same market. The psychological fear induced by coronavirus will lead to the digital transformation of the nearby shops and several of these are expected to move their business online once the lockdown ends. As a result, consumers will benefit from the wider choice of goods and services available at competitive pricing.

With the market already primed for growth and success, the nationwide lockdown in the fight against the pandemic will augur well for the e-commerce industry, as it is expected to push e-commerce proliferation up to Rs 7 trillion by 2023. This upsurge in e-commerce trends may also help preserve jobs amid the employment crisis.

A Paradigm Shift in the Logistics Industry

It is safe to assume that during and post-COVID-19, the e-Commerce sector can outgrow its previous levels if it considers providing end-to-end shopping experience to its customers from the first mile to the last-mile, including long-haul logistics. However, setting up such an infrastructure can be cost-intensive. Therefore, e-commerce players would be better off partnering with logistic players who strive for optimal utilisation of their fleets.

Preference will be given to intelligent logistical solutions, following a multi-layered approach driven by machine learning to provide lower costs to its stakeholders, with streamlined supply chain operations and smoother post-sale experience.

Needless to say, logistics and supply chain intelligence is expected to witness a paradigm shift, as most industries are built around delivery models. Post COVID-19 uncertainties will stimulate the businesses to expand their distribution efforts with the adoption of sophisticated technologies that will reduce time and cost.

In the Job Market

In a bid to cut costs, many businesses have imposed pay cuts and hiring freezes in these times of pandemic. However, some industry players are using this as an opportunity to hire skill-rich talent across verticals. Coronavirus’ positive impact on hiring can be largely felt across three industries – e-commerce and allied verticals, healthcare, and gaming.

The spike in business has led to staffing firms getting more requests from e-commerce companies to provide manpower. To cater to the increased home-delivery demand, business owners have stepped up to hire more people amid loss of employment concerns. Grofers has already added more than 2,000 people from other retailers, whose stores or warehouses are not operational during the lockdown. Amazon is also engaged in discussions with multiple companies to provide interim work opportunities to their under-utilised manpower to service the growing demand.

Additionally, a new paradigm has opened up as companies into e-commerce, logistics, FMCG, and e-wallets are betting high on small towns, to explore an unsaturated consumer base in tier II and tier III cities. Recruitment is also expected to go up by 15 percent in this space to meet the requirement of sales and delivery staff.

However, the biggest gainer remains the IT & ITeS sector that accounts for 79 percent of the total job openings that will continue to attract tech specialists with expert skill sets in programming, data analytics, and content design.

It is crucial to note that once the pandemic crisis rolls over, there will be a resurgence of business with digital components that will increase the demand for professionals with specialised skills. However, until then, applicants better look out for industries that are staying afloat. One of the very good examples is SaaS, that has witnessed low impact, as most work is conducted on yearly and quarterly contracts with clients.

Any reference/source for this data?

The research has been done by a firm called Technomic.

The author is the CEO and Co-founder, ClickPost, a logistics intelligence platform


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