Time to frame some rules for Ubers and Flipkarts in the interest of consumers
E-commerce companies, sustained on massive doses of funding provided by private equity funds, have been such a boon to consumers that we were happy to condone glitches, especially if the redress or reversal process was smooth and efficient. But large and well-funded e-commerce companies are probably so focused on fund raising and increasing valuation that they may be in danger of forgetting that the customer is central to their mega plans. Some funded e-tailers seem to believe that throwing money at consumers to compensate for bad experiences is an adequate customer retention strategy. As the business grows, companies are finding it difficult to offer cash compensation and to dish out freebies; some brazenly renege on promises published on their promotional material.
In one particular case, a consumer complained that Flipkart was claiming to offer a discount by projecting a false high price that was crossed out, while the discounted price was the actual MRP printed on the product.
All online retailers and service-providers have notoriously one-sided contracts which nobody reads. None of this mattered while they wowed customers with choice, price and speed of delivery. But rapid growth and gigantic size is bound to have an impact. Aggrieved consumers will be shocked at the one-sided terms in their legal disclaimers. Flipkart and Snapdeal, who call themselves marketplaces, are especially aggressive about not accepting responsibility for prices and product details posted on their websites.
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Defining E – Commerce
A report in Hindustan Times ( 15 July 2015 ) talks about a series of
meetings expected to be held today between Commerce Minister and
different stake-holders , to define ” e-Commerce ”
I am reminded of the story of the 7 blind men , each trying to describe an
elephant by touching different limbs of the animal
It was obvious they could not arrive at a commonly agreed upon description,
since their perceptions differed
Before trying to define ” e-Commerce ” , we must first define ” Commerce ”
In pre-historic times , persons produced whatever they needed to survive
Then they learned to ” barter ” things produced by each other
The only concepts were , ” need ” and ” surplus ”
That lead to introduction of a concept called ” Value ” , which manifested itself in the form of a stick , a weapon , a goat or a piece of animal skin , till it became , some sort of coin
When barter gave way to an exchange of some goods ( or service ) , for its perceived ” Value ” ( as measured in coins ) , it became ” Commerce ”
So , we can conclude that :
” E – Commerce ” is nothing more than ” Commerce ” , where such exchange of values , take place electronically , as opposed to physically . It still remains Commerce , even when perceptions differ
Hence , regulations / controls / taxation etc that govern E-Commerce should , essentially remain the same as in case of Commerce
Ditto for FDI in e-Commerce
Mere elimination of an intermediary ( Distributor / Wholesaler / Dealer / Agent / Stockist etc ) , from the ” Supply Chain ” , itself cannot be the determining criteria
A few years back , when General Motors , tried to sell its cars to end-customers , directly from its own web site , thousands of its Brick-and-Mortar dealers protested and even threatened General Motors
GM had to back-out against the vested interests !
But when Michael Dell started manufacturing computers in his garage , he took orders on his telephone and later , on his own web site.
He never appointed any dealers . This model became a roaring success and heralded the beginning of E-Commerce era ( read , ” Direct from Dell ” )
Under present guidelines , I suppose , India would allow Dell to set up a wholly-owned , local manufacturing facility , with 100 % FDI
Now , if Dell starts selling those India-made computers , directly to end-consumers , from its own web site , would not that be E-Commerce ?
An e-Commerce with 100 % FDI ?
And what about 100 % FDI by FoxConn ( Taiwan ) , wanting to set up 10 factories in India , to manufacture electronics goods , not only for Foreign giants like Apple / Samsung etc but also for local brands such as Micromax ?
Shall we insist that FoxConn cannot deliver such goods directly to Indian consumers , based on orders received on , not only web sites of Amazon / e-Bay but also on local web sites of Flipkart / SnapDeal etc ?
It is unfortunate that we , in India , always look-up to the discoveries / inventions taking place in the West ( – and in Japan / South Korea etc )
Had we encouraged Prof Jhunjhunwala ( IIT – Madras ) , we could be today , delivering internet thru common electric outlet in every home , at speeds of 100 mb ! That would have Digitized India , 5 years ago !
When ISRO sent MOM ( Mars Orbiting Mission ) , it did not call it a ” Space Ship ”
As long as the concept of ” Ship ” defines our thought processes , we will continue to ” Sail in a Sea ” – never to traverse the ” Space ” !
15 July , 2015
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