Established in 2012, Limeroad is one of the few discovery-and-ecommerce platforms and the first-movers in India. In the FY 2015-16, Limeroad’s sales increased by 173% to Rs 42.6 crore. But it also witnessed 3-fold increase in expenses, and the net losses jumped by 227% to touch Rs 106.32 crore.
By the end of 2015, Limeroad’s seller base swelled by 5 times and the company’s founder and CEO Suchi Mukherjee gloated about the fact that Limeroad has managed to become one of the key players in the online fashion market without burning cash like other ecommerce players.
But mails and messages sent by Limeroad sellers to Indian Online Seller (IOS) tell a story diametrically opposite to the one told by the fashion e-store’s founder.
Here’s a list of issues that sellers are facing at Limeroad.
Takes ages to make product listing live
Product listing is one of the first steps for a seller to start the online selling journey. Sellers allege that it takes months to make products live on Limeroad fashion portal. Online seller Varun Arora wrote on AIOVA forum that out of the 35 products, the fashion etailer only listed 23 products.
Seller Lurewears wrote, “I have been trying to list my products on Limeroad, and even after 2 months, out of 35 products only 15 are made LIVE.”
To this Limeroad’s communication team says, “In the last 3 months the average live to site is 4.9 days. The Live To Site duration is dependent on the information the seller provides. SKUs from sellers then go through a checking process in which case some SKUs are indeed rejected.”
The Long Payment Cycle
Sellers want Limeroad to reduce its payment cycle as the bi-monthly payment structure isn’t working for them. SMEs need working capital for day-to-day operations and hence, a long payment cycle has a negative impact on their business.
Online seller Vivek Singh shares with IOS, “Most of the marketplaces provide weekly payments, in which they do transaction every week. But at Limeroad, 2 times you will get the payment; for every 15 days they will disperse the amount. Like for the period of 1-15 December they will transfer amount at near about 1-3 Jan and same for the second half of the month like 16-31 December they will do transfer near about 16-18 January.”
He adds, “So overall it’s also ok if they do transaction twice every month but they should do it earlier on next week and not wait for additional 17-18 days. The order which comes on 1 you will get payment after 30-32 days. This delay in payment is not good from a seller’s point of view.”
In January 2017, LimeRoad did announce that seller payments would be released in 24 hours instead of monthly payments. But it is too early to determine if the move has been implemented successfully.
Misleading seller policies and payment structure
Online seller ST (name withheld on request) informs IOS that Limeroad changes policies and payment structure without informing them. In spite of agreeing to a commission margin of 25% and 30% (as per price of the product), the etailer charged ST 35%. When the seller asked Limeroad to show written proof of the policy and payment structure changes, they were unable to do so.
ST says, “…On inquiring they told that this commission is only for limited period of time, which they have never communicated. Previous Account Manager doesn’t respond on anything. We have simply asked them to give the mail in which they have changed the structure. But they failed.”
The seller further adds dejectedly, “They have appointed new Account Manager and he has communicated that he will change the commission structure to 32% flat plus service tax if we are ready. We don’t have any other option as business is already started with them.”
“The margins are always aligned with the seller partners in written to ensure there is complete transparency. These margins, and all payment calculations are clearly visible on the seller portal,” asserts Limeroad’s spokesperson.
Rejecting claims for wrong returns
Ambiguity over seller policies and fee structure is not the only issue sellers’ face on the online fashion store. ST shares with IOS that Limeroad rejects claims raised by him against unfair/wrong returns without providing satisfactory explanation. He has 6 pending cases of the same nature but the fashion etailer continues to reject the claims.
“We have received four wrong products in which the products are old or don’t belong to us. Even after giving all proofs and evidence they denied with different reason. We have told them to show the policy on mail if they have issued to us, but they failed to do so. Till now we have six wrong return cases in which two they have denied and rest four is in process from last 3-4 months,” says ST.
Mismatched and delayed payments
Ecommerce payment reconciliation is a tedious task. Add to this technical glitches and human error at the ecommerce firms’ end, which leads to heavy losses. Online Seller Nilay Thakore has been trying to get his payments from months, but with no luck.
“I registered in the month of August 2016 when I sent my products excel sheet and product images to Annanya Trivedi for listing my products on their platform. She did with some errors in weights, so they started deducting logistic cost for 2000 kg instead of 2000 grams. Hence my account balance went in negative and I did not receive any payment from their end. After continuous follow up and understanding the issue I asked them to de-list all my products so that I do not receive any further orders. They did it and promised me that the weight error will be corrected and I will receive all my payment but it has been 5 months now and I did not receive even a single payment.”
IOS has reviewed the order details, payment details, and email exchanges between Thakore and Limeroad executives. The seller support executives have accepted that due to their internal error, high transportation charges were applied to seller’s account. Even after repeated assurances of releasing payment in the next billing cycle, Limeroad has so far failed to deliver what it promised.
“To top it off when I asked my account manager Debashish Rana to look into the matter and resolve the issue, he forwarded the call to payments team and they said I can do whatever I want against them to get my payment back. This time I felt that they are cheating me and so I lodged an online complaint against them,” says Thakore.
“The issue raised by Mr. Nilay Thakore is correct. There was indeed a typo while uploading the details of the product. The issue was brought to light, and our system had a bug which caused some intermittent lines to be lost. We had discovered this bug, and we fixed it. It is clearly visible on Mr. Nilay Thakore’s vendor portal the due amount from our side, which will get paid in the next payment cycle,” assures Limeroad’s communication team.
Shipping and packaging cost calculation is skewed
Vivek Singh elucidates, “In limeroad they consider logistic as the size of packaging material you have ordered. Like if you have a product which is of 400 gms but at the same time if you have ordered a packaging material of 15*3*15 size they will charge you 1 kg instead of 0.5 kg.”
He explains Limeroad’s skewed up shipping cost calculation below:
We used to send ethnic footwear with brand name Panahi and apparels with brand name Routeen. Now if my product is 400 gm then we put this footwear into a box. Let us suppose a size of 10*4*3 then volumetric weight is 0.39kg while its actual weight is 0.40 kg but as you have used a poly bag of size 15*3*15 they will consider it as 1 kg.
Two losses that sellers suffer due to this:-
- If any customer orders 3 products then it will consider a cost of 3 kg instead of 0.90 kg
- Instead of sending product via air they will ship it via surface, which will increase delivery time and directly increase return
“The shipping and packaging costs are set by the logistics companies and not by us,” Limeroad’s spokesperson says.
As we can see, the list of issues seems endless for a company that’s only 4 years old. Sellers aren’t happy with Limeroad’s seller support as well.
Sellers, how would you rate your selling experience at Limeroad? Is it better or worse than other fashion etailers?