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It’s been a couple of months since the beta launch of Open Network for Digital Commerce (ONDC) in Bengaluru. Now, the plan is to try out a similar launch in smaller cities, said T Koshy, CEO, adding that the aim is to show the network works in a country as diverse as India.
While the cities are not decided as yet, Koshy said ONDC will look at the performance of the alpha phase of testing and choose cities with good adoption. “We are also adding new product categories like fashion, home decor, electronics, beauty and personal care on the network. This is in addition to our focus on increasing order volumes in Bengaluru through increased publicity,” he added.
ONDC has been alpha testing its services in about 85 cities among a closed group of users. In alpha testing, only few buyers were invited to use the app. For instance, ONDC sellers invited their friends and family to make a few transactions.
Challenges
Since the beta launch in the garden city on September 30, “ONDC has delivered 2,500 orders in the city and onboarded 650 merchants. It is doing an average of 60-70 orders per day and almost 40 per cent of them have been food orders,” said an industry source.
“The first challenge is that we don’t have a large number of buyers as of now and so order volumes for individual sellers tend to be low,” said Koshy, adding that it makes established e-commerce sellers delay responding on ONDC sometimes, and not give the network much attention. “Second, in the case of new e-commerce sellers, we have to work on educating sellers on the etiquettes and processes of digital commerce.”
Today, most ONDC orders come with a higher delivery charge compared with established food and grocery delivery companies. “As more logistic companies and buyers come on the network, sellers will benefit from the economies of scale and there could be logistic participants who will start offering a discounted pricing on ONDC deliveries,” he said.
Intercity deliveries
As more partners such as Snapdeal, Ekart and Meesho get integrated into the network, ONDC will also start intercity deliveries. Talking about the incentive for e-commerce companies to join ONDC, Koshy said when a platform like Snapdeal integrates its sellers on the network, it enables their sellers to reach a broader cross-section of buyers.
Further, all marketplace companies are required to bring both their sellers and buyers onto the network, which in turn benefits all participating companies. ONDC currently has 22 network partners in total, which include five buyer-side apps, three logistics partners and 14 seller-side applications.
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