A clutch of startups have sprung up in India’s business-to-business (B2B) ecommerce industry, which may finally be catching up with the rapidly growing business-to-consumer or B2C sector that has spawned the country’s most celebrated startup success stories.
Industrybuying.com, BazarA2Z, and StoreRoom.in are among new players on the B2B block, betting on tremendous growth in the near future in industry that has established the likes of 15-year-old IndiaMart and Walmart’s BestPrice.in. “Industry products in India are not catalogued in one place and are very fragmented. You would have to contact 50 vendors to negotiate to buy each product. So building all this information on one internet platform would be of huge value.
On the other hand, BazarA2Z decided to establish its online presence after running several offline B2B portals since 1997, having received multiple enquiries for its two lakh members. Bengaluru-based Storeroom.in, set up in August 2014 and specialising in household goods, now has over 600 customers and is coming out with a mobile app.
According to a Walmart report in 2014, India’s B2B e-commerce industry will grow to $700 billion by 2020 from $300 billion. For now, these portals are doing little more than a handful of orders per day, averaging Rs 10,000 each, although Industrybuying-.com’s online orders have doubled every month since it received funding from SAIF Partners in December last year.
“In India, purchasing of local distributors and wholesalers is archaic and unorganised, with high information asymmetry. There is a fair amount of inefficiency in the ecosystem and not a lot of innovation has happened, so it is ripe for tech-based platforms and models to make big business,” said Mukul Singhal, principal at SAIF Partners.