India’s new retail revolution: How the ‘jugalbandi’ between MSMEs and e-commerce is changing country’s retail space

In our diverse tapestry of India's retail landscape, a silent yet powerful revolution is unfolding, fueled by the exponential growth of e-commerce. At the heart of this transformative wave are MSMEs, the backbone of India's economy. Comprising over 90 per cent of all retail businesses and employing more than 40 per cent of the workforce, MSMEs play a crucial role in the nation's socio-economic landscape. Now, with the rapid surge of e-commerce, they are emerging as the torchbearers of the MSME-led retail revolution, shaping the destiny of India's retail industry.

The e-commerce boom in India is undeniable, and its impact on the retail sector is nothing short of revolutionary. With this boom, and with MSMEs as the driving force, they are the architects of a new era in retail, one that embraces innovation, fosters inclusivity, and heralds a brighter future for India's economic landscape. India is readying itself for the stage that accommodates 63 million+ MSMEs with its potential, which is nothing short of transformative. 

Levelling the Playing Field: Empowering MSMEs

In the dynamic landscape of India's retail industry, the traditional barriers faced by MSMEs have long hindered their growth and expansion. These limitations include the costs associated with establishing and maintaining physical stores, making it challenging for MSMEs to compete with larger retailers. However, e-commerce has emerged as a transformative force, shattering these barriers and providing a level playing field for MSMEs to thrive.  E-commerce enablement platforms have become a game-changer for merchants by acting as a comprehensive solution. These empower MSMEs to establish their online presence, manage their digital storefronts, and efficiently conduct e-commerce operations.  Through e-commerce, MSMEs are no longer constrained by their size or geographical location, enabling them to compete on an equal footing with industry giants. This empowerment of MSMEs through e-commerce is reshaping the retail landscape in India and ushering in a new era of inclusive and equitable commerce

Success Stories: From Local Heroes to National Brands

Among the myriad tales of transformation in India's retail landscape, the success stories of MSMEs harnessing e-commerce's potential stand as inspiring examples of entrepreneurial excellence. Through e-commerce enablement platforms, MSMEs have charted a trajectory from local heroes to national brands, captivating audiences far beyond their immediate locales. The case studies of Jaipur Rugwalla, ChaiWala Tea Emporium, a small tea shop nestled in a bustling Mumbai neighbourhood, and Handcrafted Jewels, an artisanal jewellery brand hailing from Jaipur, exemplify the power of e-commerce in unleashing exponential growth. By effectively utilising e-commerce, these MSMEs expanded their customer base and witnessed a remarkable increase in revenue. Transcending geographical limitations, these MSMEs have successfully penetrated the broader market, gaining recognition and acclaim on a national scale. 

Transforming 63 million+ MSMEs into digital shopkeepers

Beyond the bustling cities and urban centres, the true potential of the retail revolution lies in rural India, and e-commerce is a pivotal force in this transformation. ONDC, a visionary initiative by the government, has played a significant role in the rapid growth of e-commerce in rural areas. With ONDC's digital infrastructure and connectivity, the playing field has been levelled for BHARAT-wide MSMEs, enabling them to overcome geographical barriers and connect with a diverse and wide-ranging customer base. According to a recent report, India is poised to add over 80 million online shoppers by 2025, showcasing the growing appetite for digital shopping experiences. With this surge of online shoppers and the growing popularity of e-commerce platforms, MSMEs are poised to make their mark in the retail landscape like never before.

Views are personal. The author is Co-Founder & CEO, Shiprocket.