1. E-Commerce Business Oppertunities In India

There are plenty of exciting business opportunities in India. We have started a list of business ideas for those entrepreneurs who are interested in Internet ventures, outsourcing technology, e-commerce opportunities, software development opportunities, business trends and other business ideas. We hope to add to this list as we find case studies in Bangalore, India.

Online Customer Support From India E-Commerce Export Opportunities In India Export Animations, multimedia, Graphics Or Other Content Products Export Data Services Start A Software Company E-Commerce Business Opportunities Within India Future Topics...

1. ONLINE CUSTOMER SUPPORT FROM INDIA There is a company in Bangalore that has pioneered this idea. Aditi (www.aditi.com) provides email customer support for Real Media. The customer in America who needs support will have his problem solved via email by a team of Indians. The Internet has opened the door for this type of opportunity. It really is true that the geographic barriers are coming down.

The Potential: The business potential in this type venture is the cost savings of running a business in India. There is a huge labor pool of good quality English speakers who can easily handle customer support for web sites like RealMedia. The cost to hire someone to do this is about US $150-$200 per month. You can expect to hire a very nice English speaker who has had some computer training. Furthermore he or she will have a pleasant attitude, as most Indians are warm and friendly.

The Downside: The risk is that the customers will not be served well if the Indian staff is not trained properly. The staff needs to understand the mindset of the American customer. This can easily be overcome as long as the potential problem is recognized.

2. E-COMMERCE EXPORT OPPORTUNITIES IN INDIAThere are plenty of things that can be purchased and exported. One young man has sought out unusual coffee and spices and now has an e-commerce site where he sells these items through the mail. Perhaps it is not even necessary to purchase and warehouse anything. Partnering and establishing joint ventures with Indian companies would give you the opportunity to handle a variety of products without the risk and cost. You could simply create a website that sells the products. This is not much

different than Amazon.com. Do you realize they don't publish books? They just sell other's. Often they have the book sent to the customer directly from the publisher eliminating the shipping and storage.

The Potential: The potential is to find a niche market. Perhaps this could be in the area of health care products, herbs or plants that are only found in India.

The Downside: The risk is that the product may not sell. Fortunately the Internet can be used to test the market before taking much risk. It is much easier to find the demand for items and then meet that demand than to start with the product. India has plenty of products that can be tested on the market.

3. EXPORT ANIMATIONS, MULTIMEDIA, GRAPHICS OR OTHER CONTENT PRODUCTS Again this idea utilizes the skilled creative labor force in India. We have not been able to find a case study of a company doing this in India.

The Potential: The potential is to fill the huge demand for quality content that the web is creating.

The Downside: The downside is that it requires careful supervision to assure that the product communicates effectively to a Western audience. For example, a Westerner's taste for colors is different to that of an Indian.

4. EXPORT DATA SERVICES Any kind of outsourcing of data entry or data conversion is a good candidate for a successful start up business in India. The hottest thing these days in Bangalore is medical transcription. Doctors and hospitals in the USA send their audio transcriptions via the Internet to Bangalore, India. They send the audio file at 5:00pm which is around 5.00am in India. The workers can do their work so that the Doctor has the text document the next morning. In Bangalore you can find good examples of companies already doing this. Go to Yahoo and type in "data entry India" or "data conversion India". You will be startled by the amount of information that is available.

The Potential: The potential for this type of business venture is great. Many of the Bangalore companies are growing and adding employees quickly. The reason there is such a global demand for this kind of work is because companies want to have their documents in a digital format. This conversion may include scanning the document into the computer and then going one-step further and tagging and indexing them in HTML SGML or XML so that it can be put on the Internet and easily retrieved. The entrepreneurs who are willing to joint venture with Indian partners to start up a business like this will not only make money but will be doing a great service for India by providing high quality skilled jobs.

The Downside: The risk is in, not maintaining top quality work for the client. This has been a complaint of many clients.

5. START A SOFTWARE COMPANY There is nothing new about this. There are plenty of success stories. Bangalore already has at least 600 software companies. Most of these are Indian owned and non-resident Indians have started a few of them. For a list of Bangalore software companies you can go to resource page. Government of India and especially Karnataka (the state in which Bangalore is), is encouraging foreign involvement and investment and has turned on the green light to hi-tech companies. They have even created some tax incentives for this industry.

The Potential: The potential is for the development of quality software using the extremely intelligent labor force in India at a lower cost. Cost savings can be found in rent, insurance etc. High quality programmers can be hired for 25%-50% of the cost of the same software programmers in the West. For a good example look at gseindia.com and read the history of this high end Swedish/Indian Software Company.

The Downside: The downside is that there are inefficiencies related to working in India i.e.: erratic power, government bureaucracy, poor Internet connections etc. Unless the cost saving is considerable, many of the problems related to doing business in India will offset the benefit.

6. E-COMMERCE BUSINESS OPPORTUNITIES WITHIN INDIA The consumer market is huge and expanding. It is not only growing by sheer population growth but also because the improving economy is producing a growing class of people with disposable income. Furthermore this potential market is relatively untouched. It is only in the past few years that many consumer products have become available in India.

The Potential: The potential is to get involved early in the e-commerce boom. As of now there are only a handful of companies involved. The potential is limited for the next year or two (see below). But keep in mind that China had only 600,000 Internet users in November 1997 and by October of 1999 China has about 4 million users (And the big advantage that India has over China is the common use of the English language.). The same growth of the Internet will happen in India.

The Downside: There are some serious obstacles in the way. Few people are used to the idea of mail order. It may take one or two years for the trust to be established between the customer and the company. Also the middle class is 50-70 million but only about 1 million have direct access to the Internet, only 1 in 36 Indians have a phone and most don't have a credit card.

2. 4 Reasons E-Commerce Is Set To Boom In India

E-Commerce is one of the most exciting spaces for today’s global online community, and India’s young startup economy is along for the ride. In the less than three months of 2011, Indian VCs have already invested over $50 million in seven e-commerce companies, a 400 percent increase over the same period just last year.

However, e-commerce in India has a long road ahead, and e-commerce infrastructure and best practices are in their infancy. India’s 7 to 9 percent Internet penetration lags far behind the 30 to 40 percent China and Brazil enjoy, and while India’s estimated 100 million Internet users still comprise the third largest online population, the total Indian e-commerce market was approximately 3 percent of the U.S. market last year ($6.7 billion versus $227.6 billion).

Within these great challenges lie great opportunities, and the maturation of India’s e-commerce ecosystem is no different. A recent report by the Internet and Mobile Association of India reveals that India’a e-commerce market is growing at an average rate of 70 percent annually, and has grown over 500 percent in the past three years alone. Here are four reasons that e-commerce is set to boom in India, after years of false starts:

1. Critical mass of Internet users: With more than 100 million Internet users, the country is beginning to achieve a critical mass of users who are familiar with web services. In addition, over the past few years, relatively sophisticated online travel agents (“OTAs”), such as MakeMyTrip – which started turning these initial Web users into Web consumers – have dominated Indian e-commerce. While these OTAs have accounted for up to 80 percent of Indian e-commerce in the past, industry giants such as eBay and the new crop of e-tailers expect to participate more heavily in this conversion of Web users to Web consumers, with an estimated 70 percent growth in Indian e-commerce for 2011.

2. Rising middle class with disposable income: Throughout India’s short history, the country has been a land of “haves” and “have-nots”. However, with the rise of small and medium enterprises, foreign direct investment, and India’s own powerful multinational corporations creating millions of new jobs, a new generation of globally-minded Indian consumers has been created. These consumers are spread across the country. Furthermore, access to many global and domestic brands is limited to major metropolitan regions, such as Delhi, Mumbai, and Bangalore. Therefore, this growing middle class is increasingly turning to e-commerce as the primary outlet for sophisticated consumer products and services.

3. Payment gateways & logistics: One of the largest challenges to e-commerce in India is the lack of infrastructure to support new businesses. Logistics companies have been notoriously unreliable, and complex interstate regulations mean that interstate logistics and paperwork is more like international customs. Additionally, Indians have an aversion to credit cards – only an estimated 2 percent of the nation has a credit card. However, the new breed of domestic logistics companies recognize the importance of reliable delivery and technology investment, and a number of new payment gateway companies such as CC Avenue have sprung up to service the growing e-commerce ecosystem. Alternative payment methods such as netbanking and cash on delivery are now mandatory offerings for leading e-commerce platforms and can drive as much as 75 percent or more of transactions, and sophisticated technical integrations make the experience seamless.

3. E-Commerce in India – A New Business Mantra

In last couple of years, the word “E-Commerce” has taken a prominent place in the vocabulary of Indian entrepreneurs, investors and customers.

Almost on regular basis, we have been hearing stories of e-commerce ventures getting enormous funding from venture capital investors. The pertinent question here is whether the hype created around this new breed of business model is worth or things may go awry like in year 2000? With crashing of NASDAQ in year 2000, many start – up E-Commerce ventures closed down their operations and it was nightmarish experience for some of the entrepreneurs. However, this time around, the scenario in E-Commerce sector (at least in India) is looking quite upbeat and this can be attributed to following factors:

Exponential growth in Internet connections and web users, have a look at the Internet growth rate in India

Change in customer’s mind set and increase in disposable income. Better infrastructure and transportation system. Growth in Credit and Debit card users.

As per the study of Associated Chamber of Commerce and Industry, India’s retail market is now pegged at Rs. 2700 Cr. (nearly 500mln US$) and projected to rise to Rs. 7000 Cr.(1.4 Bln US$) by 2015. To cash in on the vast opportunity, a number of E-Commerce start-ups have mushroomed in last few years. Most of them have been attracting capital from angel, early stage and venture capital investors. In Indian context, we can say that success of ticketing websites like irctc.com and makemytrip.com paved the way for other online ventures like snapdeal.com, flipkart.com, naaptol.com etc. Though 70-80% of total E-Commerce business is still coming from the ticketing sites,

however, other categories like Books, electronics, high end gadgets and apparels are also generating a lot of revenue of late.

A recent white paper by First Data Corporation and ICICI Merchant Services says “E-Commerce in India has been growing at a 2-3 percent rate on month on-month basis and almost 50% annually”. Looking at these impressive figures, global players like Amazon.com is planning to enter Indian market and that will make this sector more competitive and interesting.

Major Challenges ahead:Like any other business model, E-Commerce has also got few challenges pertaining to India Market. Major challenges in this sector are:

1. Supply Chain and Logistics: We need to have lot of improvement as far as logistics and supply chain is concerned. The main reason of success of E-Commerce in developed countries was their rock solid logistics in place. In India, most of the small towns are still not covered by courier or logistic companies. Customers of small towns and villages are also adopting the E-Commerce in a big way as most of the products are not physically available at their place. Unless and until last mile delivery system is improved, the growth of E-Commerce will be hampered. To ease, this bottleneck companies like Flipkart.com is launching their own delivery system so as to cover maximum population of India. Service providers like Aramex and Chhotu.in are helping E-Commerce companies ship their products to customers across the nation.

2. Cash On Delivery System: Most of the E-Commerce companies are banking heavily on Cash on delivery ( COD ) mode of payment. COD has been touted as the innovation to counter the low credit card penetration and payment security issues on the internet, but this system has been proving to very expensive to the E-Commerce companies. Depending on the products, the 30%-50% of online purchase is taking place through COD payment option. Unfortunately in majority of the cases, customer refuses to make the payment on some or other pretext, once product is physically delivered to them. In this case not only E-Commerce companies tend to lose the sales they also have to bear the to and fro cost of the courier, which makes whole transaction a loss making preposition. Option of COD payment should be adopted very judiciously; otherwise basic philosophy of E-Commerce business will be at stake.

3. “Touch and feel” Factor: Online shopping is better suited for products and services that do not require the “touch and Feel” experience. Probably, that’s one of the reasons for the success of websites selling books, electronics and ticketing. For categories like apparel, jewelry, Handicrafts, customers would like to see the product before buying and that is a big challenge for the E-Commerce companies. Customers are also skeptical about the quality and workmanship of the product.

4. Non Uniform Tax structure: Unlike in the developed countries, where uniform tax system is applicable across the nation, In India tax structure is not uniform and that creates accounting problems for the E-Commerce companies.

4. Amway India Forays Into eCommerce

Direct selling FMCG company Amway India, has forayed into e-commerce with the launch of its website www.amway.in. The portal is a strategic lever to deliver on

Amway’s objective of crossing Rs 3,000 crore in revenue by 2010. It is further aimed at leveraging the online medium to further expand the company’s existing distribution network across 5,00,000 Amway Business Owners, while also providing consumers in semi urban areas with direct access to Amway’s expanding product range.

“Having grown from Rs 91 crores to Rs 800 crores in under ten years, we are now poised for further growth and expansion, and need to reach out to a wider consumer-base. We believe, our enhanced presence on the internet has the capacity to fuel this growth,” Bill Pinckney, MD and CEO, Amway India said.

5. E-Commerce: Challenges and Opportunities

http://www.indianmba.com/Faculty_Column/FC822/fc822.html