Eight to ten years back there was an onslaught of low-cost Chinese phones in the Indian market. The numbers went down (though didn’t vanish) after many new India based manufacturers like Micromax, Reliance, Lava, and Karbonn came up with low priced mobile devices. Looks like ‘Made in China’ products will enter India again on a big scale via ecommerce channel.
China’s DHgate and India’s Shopclues’ arrangement
DHgate, a wholesale marketplace rooted in China has made a deal with India-Gurgaon based Shopclues. Founded by Diane Wang, the Chinese B2B ecommerce company will sell their products on Shopclues. Their product listing will include electronics, sports, accessories and beauty products among others.
T T Wang, Senior Director – Operations of DHgate said “It’s (Shopclues’s) wide reach in tier-I, -II and -III cities of India will help us establish an expansive network of sales in the country.” On the other hand, Sanjay Sethi, Co-founder and CEO of Shopclues shared, “The (Chinese) merchants will get access to the huge Indian market. As part of the agreement, DHgate would get a certain range of commission depending on various aspects of the categories that are available on our marketplace now.” Sethi is expecting that at least 10 percent of their gross merchandise value, which is expected to cross $1 billion in a year, comes from this deal.
Chinese ecommerce companies eyeing Indian online market
While DHgate has made headway in Indian ecommerce market by signing up with Shopclues, there are others too in the line. China’s biggest ecommerce company, Alibaba has already bought stake in One97 communications, tied up with cashback site, Cashkaro, revived talks with Snapdeal and is looking to acquire more Indian e-commerce sites.
The competition between Indian marketplaces is already at its peak. An already crowded space will now be more crammed by Chinese ecommerce companies. What does this mean for ecommerce? Will the discounts go even lower or the losses will pile up? Does that mean Indian sellers will get a raw deal? And with ‘Make in India’, a motto brought in front by our current government, how will Make in China fit in? Especially, when Prime Minister, Narendra Modi just wrapped up his China visit and signed business deals worth many millions.