According to the FDI policy guidelines, “Marketplace label of e-commerce means providing of your i . t platform by an e-commerce entity on a digital and electronic network to behave being a facilitator between seller and buyer.”
The principle feature of the Marketplace model is the e-commerce firm, like Amazon, Flipkart, Snapdeal, etc. give a platform for customers to activate which has a large number of sellers onboard to get an item online. Thus, every time a product from amazon is bought, you are actually acquiring it coming from a registered seller from it. As a result the product isn’t directly sold by amazon. Here, amazon is simply a website platform which facilitates a gathering place for a consumer to meets many seller and give various options and value levels for any services or products.
Whereas the Inventory-led websites have specialized but limited product selection along with the serious customers may sign in to the telltale website for any specific product selection, such as caratlane.com for precious jewellery, booknest.into buy books, swiggy.com for ordering food, 1mg.com for medicines etc.
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Anchor Seller and a Level Playing field
A lot of the marketplace players have anchor sellers on panel, that are either their subsidiary entities or even a large enterprise who may have inked privileged handles them which helps them offer cheap deals or discounts towards the customers. This may include a higher discount on products, FREE shipping, compensation for sales returns etc. The losses incurred on these deals /services are compensated by the Marketplace Player under a pre-agreed arrangement.
It’s easy to see that some goods are available on the web site at 40% -60% discounts which is even a hardship on the manufacturer to make available. It’s easy to see that you’ll find 40-50 sellers for any competitive books but excepting one anchor seller, no one is able to make available such exciting discounts or offers. They can mask other seller completely and corner almost entire interest in the products, thereby also frustrate these multiple genuine sellers to arrive at the shoppers using honest pricing offers.
Virtually all e-commerce players are stored on the verge of re-discovering their business models and wish to become profitable sooner. The reality is, none happen to be capable of seeing anything at all in profit so far. Many big and promising e-commerce and unicorn players have perished due to unsustainable losses and lots of happen to be out of stock to others. Year 2017 would see many more to lock belts and go on to solve this riddle lest they perish within the race towards the survival from the fittest.
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