Things You Need to Know Before Starting an Online Business in India

Online business is getting popular these days and it has grown ten times from past 6 years. Internet is penetrating very fast in India. Users from rural India are also growing at fast rate as penetration of smartphones is also increasing fast rate. Indian Government is promoting Digital India campaign to expand the internet network across India. India is third highest country in the world with 250+ million users followed by US and China but still internet penetration is very low (19%) in India and soon it will overtake US in next 10 years.

Internet Penetration

Online business is increasing at very fast rate than any other industry in India and revenue from online business has grown 10 times since 2009. Many urban users prefer to shop online than offline shopping. You can’t buy each and every product online as some product needs to be checked physically to check quality of products. Electronic items, Gadgets, Apparels, Computer Accessories, Backpacks, and Shoes etc. don’t need too much research to buy so users directly search it on ecommerce portals and buy it. Online shopping helps you to save time as well as money as you don’t need to visit store physically. You can also get real reviews from users so we will definitely come to know whether products are good or bad. Users directly post their real life experience so it helps to new users who want to buy products.

Let’s see how eCommerce industry has grown from past 6 years:

Indian Ecommerce Growth

You can also create your online store on eCommerce portals like Flipkart, Snapdeal, Amazon, Shopclues, IndiaTimes, eBay etc. If you have a shop or store or you are working from home then you can also create own store and sell products directly to users. There are some prototypes or rules you need to follow to be eligible as a Seller.

Things You Should Have to be Eligible as a Seller:

  • You should have VAT (Value Added Tax), CST (Central Sales Tax), TAN or TIN (Tax Identification Number) Number. You will be eligible to sell products within your home state if you have VAT Number. You will be eligible to sell products across India if you have CST Number.
  • You need to upload your documents like PAN Card, Adhar Card, Cancelled Cheque (personal or business savings or current account)
  • If you don’t have anyone document mentioned above then you seller account will be declined. Their seller account executives will help you through the registration and verification process.

How to Create a Seller Account?

I will show the procedure of only one eCommerce portal as process is almost same for all portals.

Step 1: Sign Up with Email ID and Mobile Number and Password then click on confirmation email.

Step 2: Once the registration process is done then you will need to fill-up business details by putting business address, product pick-up address etc.

registration

Step 3: You need to upload Individual or Business document for business verification process. It will ask you to upload Adhar Card, PAN Card, Cancelled Cheque, VAT and CST Number and the account will go through seller account verification process (it might take 48 hours for verification).

TIN

 

Step 4: Once the verification is done then they will guide you how to upload products. You don’t need technical knowledge to upload products. You need follow a standard procedure by putting details in excel sheet by standard format. They have various products formats i.e. excel sheet product attributes are different for different types of products (electronics, clothing, back packs, kitchen ware etc.)

store details

Step 5: Once the products are uploaded then it will go through automatically system process and will add products directly on website if they are error free.

Distribution Management: Most of ecommerce portals have tied-up with courier services so you don’t need to ship products directly to users. Courier service providers will directly come to your shop to receive the products to deliver customers. It also saves your time and money.

Note: You can manage products at basic level through mobile application and mobile app is best way to get connected with online store. Online inventory management is also possible through mobile appĀ  but to some extent.

You don’t need a million dollar business to start you business online as online business doesn’t need a big shot with huge rent and labors. You can manage your own store without depending on other. In this way online store will remove various operating cost like shop rent, labors wages, electricity charges, administration expenses etc.

If you want to make your business successful then you need have following things:

Good Product Quality: If product quality is poor then users might post negative reviews and it may lead to account termination.

Delivery: Products need to deliver on times as users will switch to other seller if they find quick delivery.

Product Replacement: How soon can you replace products if they are faulty or defective.

Inventory Management: Keep your product inventory to minimum level so then it should serve the client until next consignment reaches your warehouse. It should not happen than you don’t have products in hand to deliver and you already have orders. It may harm the reputation your seller account on eCommerce portals.

Product Defect Rate: You should know the product defect rate before putting it on online store as it will help you keep minimum cost of product.

Pricing or Commission Structure on eCommerce Portals:

They have commission structure for products based on their categories. They have different price structure of electronic items, clothing, kitchenware, hand craft times etc.

Let’s see an example here:

commission structure

 

Conclusion: Why don’t you take an advantage of online business which is getting popular these days. It’s not a rocket science to start an online store on Amazon, Flipkart, Snapdeal etc. You just need to have basic documents to avail a seller account. Online business is better than traditional offline business as operating (Rent, Electricity, Labors, Administration, and Infrastructure etc.) is not incurred so you save a lot of money even if you sell product as lesser cost.

About Anurag Golipkar 49 Articles
Anurag, with more than 7 years experience in the field of Digital Marketing, is a B.E (IT) from Mumbai University. Currently pursuing an MBA, he has over the years mastered the art and science of targeting the online customer, be it through SEO, SEM, SMM or other online media. A certified professional in Google Adwords & Analytics and Hubspot, he brings tremendous value and thinking to brands that want to optimize the use of the online medium.

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