A New Threat to the Existing E-commerce Sector

by Vansh Lakhisarani

Open network digital commerce is a network that enables local sellers, retailers, food deliveries, and other businesses to set up digitally without having to be dependent on profit-based platforms like swiggy or zomato. It is a private non-profit company established by the Department for Promotion of Industry and Internal Trade (DPIIT) by the Government of India.

Launched in April ,2023, ONDC came in highlights recently when some users noticed the price difference compared to other profit-based companies. This allows the cutting of unnecessary mediation that are charged by private companies to generate revenue. Enabling sellers to directly receive orders from clients and deliver products or services in the cheapest possible mode. For the time being, MyStore is a platform that offers operation on ONDC where food chain owners can list their items for the consumer market.

Big digital companies like Swiggy and Zomato charge over 25% of the original cost from sellers and clients. Many more such organizations, either in duopoly or oligopoly, maintain the market rate without compromising price and revenue.

In the existing e-commerce sector, sellers and buyers have a limited number of platforms that are distinctive. To continue on this model, sellers have to accomplish the hefty task of stock listings on different platforms simultaneously, all while paying commissions to the platforms. Meanwhile, buyers are also at mercy of the platforms for the price they pay. The new entrant ONDC allows sellers and buyers to interact at a common network and access a larger market that fits their demand and supply without having to pay extra. The new model will also encourage new sellers to setup digitally and explore a larger customer base by just operating on a single network. When the buyers and sellers will have full control over their choice, India, through ONDC, will achieve a futuristic marketplace that can be called as ‘Democratic E-commerce’.

Predictably the ONDC will dethrone the current market monopolies, the emergence of new leaders is also on its way. As the opportunity is approaching the doors, many future leaders shall and will make the most of it. For every possible e-commerce business from UPI to food delivery, ONDC-specific apps might enter to dominate the then market. It might sound like chaos or market-dominating nature of ONDC in succeeding years, once adopted by users, it will be way more comfortable and beneficial for them.

The entry of ONDC poses a threat to established e-commerce businesses as now private profit-based corporations-can not even think of putting ahead a price war. As of 2023, ONDC network is only available in five Indian cities which are Delhi Capital Region, Shillong, Coimbatore, Bengaluru and Bhopal. Soon ONDC will reach out to other parts and then either some of the established companies will vanish or the private e-commerce sector will come up with master plan. Further updates on ONDC are still in the hands of GOI.

About the Author:

Vasnh Lakhisarani is a fourth-semester student of  Journalism and Mass Communication at Amity School of Communication, Amity University of Rajasthan. He has a penchant for anchoring, editing, and content writing. In his spare time, he loves to read novels and watch cricket. 

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