The ecommerce arm of One97 Communications, Paytm Mall, is now looking to tap India’s potential for exports, just like ecommerce giant Amazon did last month during Jeff Bezos visit. The company announced that its mission is to promote Indian products in global markets.
Paytm Mall added its assortment of ‘Made in India’ products include perishable goods such as rice, spices, tea, dry fruits, millets, essential oils, quinoa, moringa, organic food, frozen food, fresh fruits and vegetables, pulps and pastes.
It has been engaging with existing partners such as Mawarid Distribution, Mayar Foods, Vedica Organics, Ceegee Impex, Five River Foodstuff, etc. Now the company said it has expanded the market for Indian products in Southeast Asia, Middle-east, USA, Canada, and Africa, thereby, increasing the business opportunities and growth for Indian sellers.
Paytm Mall’s Export Focus
It is to be noted that in July 2019, eBay had announced a strategic partnership with Paytm Mall along with acquiring a 5.5% stake in the Indian ecommerce marketplace. At the time, Paytm Mall said that the strategic partnership should allow it to overcome cross-border trade challenges such as high delivery costs, returns and long timelines, while ensuring that regulatory requirements are met, including the payment of customs duties.
In order to improve the quality of products and to enhance tech adoption among its merchant base, the ecommerce company claims to be upskilling its existing merchant partners. With the target of INR 500 Cr GMV in the first two years of operations for exports, Paytm Mall has been setting up teams in skill development centres to leverage more opportunities and to carry out the trade across geography in a more efficient manner.
Sanjeev Misra, senior vice president, Paytm Mall said, “We have entered into the exports with an objective to offer a range of Indian products across the global markets with super efficiency. We have a well-established network of suppliers and are deploying our team across the geography.”
Will Exports Help Overcome Losses?
Founded in 2017, Paytm Mall has lost market share over the years as the onslaught of Flipkart and Amazon resulted in those two companies dominating the ecommerce space. From 5.6% of the market in 2017, Paytm Mall had 3% market share in 2018 with a further decline in 2019. The company has raised over $795 Mn from investors such as eBay, SoftBank, Alibaba and others.
In the middle of this crisis, Paytm Mall worked hard on getting its leadership and operations right. In FY 2018-19, the company saw a rejig of top-level management followed by over 80% cut down in cashback across its online marketplace categories such as grocery, electronics and fashion.
Paytm Mall had decided to narrow its focus to a wholesale platform with offline-to-online local commerce becoming its core focus, instead of a consumer-facing ecommerce site. The company expects to generate a bulk of its sales from O2O, with 15% coming from wholesale and 35% from warehouse items.
On a standalone basis in FY19, Paytm Mall reported revenues of INR 868.16 Cr, a Y-o-Y increase of 24.9% with a 17.11% decrease in expenses reaching INR 2139.60 Cr. The company’s losses also decreased by 34.4% to INR 1171.62 Cr.