A few days back , Commerce Ministry announced FDI norms / guidelines in relation to E Commerce
This was done, even as DRAFT of the new E Commerce Policy is yet to be released ( - a “ work in process “ for past 2 years )
Briefly , it reads :
· E-Marketplace players cannot sell products of companies in which they hold a stake. Such an ownership or control over the inventory will render the business ( market-based model ), into an “ Inventory-based “ model
· Inventory of a vendor will deemed to be controlled by an e-commerce marketplace entity if more than 25 % of purchases of such a vendor are from the “ marketplace entity “ or its group companies
· E-commerce marketplaces to furnish certificate and report of statutory auditor annually to RBI confirming compliance
· E-commerce marketplaces are allowed to support services to sellers, such as
# ORDER FULFILLMENT
# CALL CENTRE
# PAYMENT COLLECTION
· E-Commerce companies with foreign funds have to compulsorily operate as a “ marketplace “, as FDI is allowed only in such models, and not in “ inventory-based “ ones
[ Under an “ Inventory-based “ model, companies can sell their “ own “ items , whereas in a “ marketplace “ model, they can only serve as the link between buyers and vendors ]
· E-commerce “ marketplace “ entity should not mandate any vendor to sell any product exclusively on its platform
· What is the E-Commerce “ model “ of Reliance Retail [ RR ]-
Is it a “ Marketplace “ model or an “ Inventory-based “ model ?
Ask Mukesh Ambani and very disarmingly , he will say :
“ Oh , ours is a “ Hybrid Model “ and therefore it is outside the purview of the guidelines / norms just announced
It makes us “ F-Commerce “ – short for FUTURE of COMMERCE “
F-Commerce for the following reasons :
[As envisaged in :
All of your merchandize will be available for selection / ordering on our ONLINE web portal
This online presence of your merchandize will expand / extend your " reach " to thousands of consumers in your neighbourhood
You will need to only focus on OFFLINE ( across-the-counter ) sales to consumers who walk into your store
For OFFLINE sales , we will install in your stores , all the necessary Computers / POS terminals / Routers / Internet Connections / Mobile Wallet Payment systems and an end-to-end , RETAIL MANAGEMENT software
All of your OFFLINE sales data will get transferred to our Central Server
We will deliver to your store , all merchandize on " Consignment " basis
This means , you do NOT need to pay us for what we deliver to you store !
Till sold , all goods in your store will be our " stock "
This way , you do NOT need any " Working Capital " as far as your stocks are concerned
We will also tie-up with the manufacturers
You don't need to have any interaction / dealing with the manufacturers
On a continuous basis , our web server will keep a track of each and every item of merchandize sold from your stores
Our Server will calculate , your " Stock Movement "
Based on this data , our Server will compute / set for each item :
# Minimum Stock Level
# Alarm Stock Level
# Stock Re-Order Level
# Re-Order Quantity ( Minimum Batch Size )
Based on this logic , our Server will instruct the relevant " Merchandize Manufacturers " ( or their dealers / stockists ) , to deliver the stipulated " Re-Order Quantities " to your stores
A " Re-Order Instruction intimation " , will get delivered to your computer
Upon arrival , you will need to update the data
From time to time , our Software will also figure out your current stocks of " Extremely Slow Moving " and " Obsolete / Expired " items , and arrange for " Return Delivery " , which you will need to enter in your database
Not only we will deliver the merchandize to your store , but we will also pick up " Ordered Items " ( for ONLINE orders only ) , from your store and deliver the same to your customers !
Initially we will employ manual " Delivery Persons " for this but , before long , we will deploy a fleet of autonomous DRONES for this purpose
This fleet will cover " Kirana Stores " and " Online Customers " , located in pre-designated areas , covering 4 sq km ( 2 km x 2 km )
We are in talk with www.What3Words.com , to enable precise delivery through your 10th floor window !
These drones will get their " Delivery Instructions " directly from our Web Server , for all ONLINE orders
When these drones arrive at your Store to pick up the items ( to be delivered ) , they will transfer ( Blue Tooth / NFC ) and display on your Computer screen , following data :
# Online Order Number / time / date
# Items covered with description / value of each
# Customer Name / Address
# Mode of Online Payment / Bank Details
# Your online account CREDIT details , giving,
( Sales Value ) - ( Purchase Price )
" Purchase Price " of goods in your stock will be
based on FIFO method
As explained earlier , you will have a bare minimum need for " Working Capital " , since all of your stock will be on " Consignment " basis
We will collect the " ONLINE PAYMENTS " directly from the customers and " Credit " the same to your " online sales account " with us
Against same account , we will " Debit " the " purchase price " ( price at which you purchase the merchandize from Reliance ) of the goods sold
Our server will also take care of all GST payments and filing of GST returns
As far as OFFLINE sales is concerned , all the data captured through POS terminal will get transferred to our Central Server
Not only will we carry out all marketing for your ONLINE sales , we will help you with your OFFLINE marketing , through introduction of the following technology-enhanced features :
# Arranging a better display of merchandize on your shelves / re-arranging of shelves
# Introducing Augmented Reality ( AR ) for clothes / fashion goods in " Trial Rooms " for giving the customers , an experience of " touch - feel - looks "
# Introducing Robots to answer customer inquiries
# Eliminating " Check Out Counters " , based on " Payments through Bio-metric Recognition " of customers
# Embedding RFID sensors in each item of merchandize and RFID readers embedded in Shopping Carts
# Improving your window display thru rotation
# Introducing music
# Eventually replacing " Physical " merchandize with " Holographic Display " of merchandize on your store shelves !
Apparently , Mukesh seems to have come up with his “ F-Commerce “ model , after reading the following :
[ source :
" E- Commerce and Foreign Direct Investment " are the " Special Theory of ECONOMY " , whereas " Commerce and Investment " are the " General Theory of ECONOMY "
The best that the Committee can recommend is adoption of the following ,
Parekh's , " 3 Laws of E-Commerce Economy "
- to be incorporated as 123rd Constitutional Amendment
( with apologies to Isaac Asimov's 3 Laws of Robotics ! ) :
LAW # 1 :
A robot may not injure a human being or, through inaction, allow a human being to come to harm.
Rules / Regulations of E-Commerce shall not come in the way of unfettered creation of SELF EMPLOYMENT
Any existing Law / Rule / Regulation that hinders a person to become Self Employed, shall be treated as ultravires
Further , any Law / Regulation of " E-Commerce / FDI " which slows down Investment ( Foreign or Local / Official or through channeling of BLACK MONEY ), shall be treated as " bad in law " and struck down
LAW # 2
A robot must obey the orders given it by human beings, except where such orders would conflict with the First Law.
Laws / Regulations governing " E-Commerce / FDI " shall be subservient to Laws / Regulations governing " Commerce / Investment " .
Whenever any Public Authority / Court finds conflict between the two , laws / regulations governing " Commerce/ Investments " , shall prevail under all circumstances , and in favor of the self employed
LAW # 3
A robot must protect its own existence as long as such protection does not conflict with the First or Second Laws.
Laws / Regulations of " E-Commerce / FDI " which get over-ruled under LAW # 2 , shall immediately " Self Destruct " in favor of unobstructed progress of TECHNOLOGIAL ADVANCES
01 Jan 2019
RSVP : hcp@RecruitGuru.com