“The sheer increase in volumes that we had been seeing every single day in the affiliate marketing space prompted me to think that somebody has to be selling all this stuff, so why not?” quips 24-year-old Sugam Jain from New Delhi. Thus was born WonderKart, to sell mom and baby products, and kids toys and games across different marketplaces.
Sugam is also the co-founder of GoPaisa.com, one of India’s largest cashback & coupons site started in 2012. But he is not associated in an operational capacity anymore.
Have his views on online marketplace selling changed? Does he still feel attracted to the concept? Let’s find out, in this IOS exclusive interview with the young and chirpy entrepreneur.
Marketplace sellers are the backbone of the industry, but I wanted to understand what makes the entire ecommerce machinery run. I could see it as a challenge I wanted to tackle to create a high volume ecommerce business.
Also, my primary passion has been technology, so I also wanted to see how technology affects an online seller’s margins. I thought I can enable building such products to help us all.
It is completely self-serve so you have to start from scratch and then it’s just easier to grasp policies and procedures for rest of the marketplaces and their fundamentals. Gradually, we expanded to other marketplaces which took some doing but we were able to do so successfully within a period of 45 days and volumes increased substantially.
Initial challenges included logistics, packaging and accounting.
But I feel it’s a necessary part of the online selling journey. Without a few suspensions and penalties, nobody tries to improve processes resulting in a loss of growth rate.
It comes up to an average of about 10-15%. We try and improve listings and packaging to reduce return rate of a particular product. But beyond one point returns cannot be lowered; it’s the cost of doing business.
Selling on marketplaces is definitely profitable. It may not be as highly profitable as one would want but margins are always category dependent. Also, they depend on sourcing and operational efficiency. We have to run a tight ship to achieve margins.
I don’t see ecommerce as an industry but more as a way of life. It is something that has evolved naturally with technology like the rest of the world has. It has been there since the advent of internet, maybe in a different form and will always be there. Maybe the models, way of selling things, accepting payments etc. may change with time.
Both models of selling have their own pros and cons. It totally depends on the nature of business, budget and also no.of SKUs. I don’t suggest going with own online store unless you have at least 250+ SKUs. Online store takes more investment in terms of development and marketing, and it needs dedicated resources. So these things should be kept in mind before starting.
I don’t think marketplaces need to absorb the charges but sellers should be given the liberty to choose if they want to provide this service or not. But yes, the practice could be harming the market overall. Once the investor funds dry up, which enables marketplaces to absorb these costs, reality will strike. Buyers will have to pay shipping, COD and return charges which will lead to decline in sales volume.
So it’s better that buyers are educated about the same and everybody reaches a reasonable level of understanding to share these costs.
Sure, anyone willing can sell online. But I feel it does not make sense for a manufacturer or direct importer to get into online selling as it needs dedicated infrastructure and procedures. But if someone has a focused approach and the required ideology, and wants to create a private label, why not?
Who agrees with Sugam?
After dwindling with her family business, into travel and hospitality, for more than 3 years, Pooja Vishant found her true love in writing. Happy-go-lucky and cheerful, she loves pink; so pink is the way to go if you want to get into her good books. The Associate Editor keeps track of even a leaf that has moved in the ecommerce world!