Shopclues.com, which claims to be India’s largest online marketplace for small and native businesses, traces its origins to CEO Sanjay Sethi and his co-founders noticing how such businesses in the country were plagued by fragmented supply chains, unorganised retail, high occupancy costs, and unclear regulation. This was in 2011, and they decided to take up their cause, Sethi told Deccan Herald.
“Shopclues.com puts small businesses on a level playing field alongside big players,” says Sethi. Indeed, 90 per cent of the website’s merchant base is made up of SMEs (small and medium enterprises). They contribute proportionately to the volume of business in the platform.
Though the SMEs sell products with huge demand, in the absence of a standardised catalogue, their businesses are unstructured. Enter Shopclues.com, which backs up such businesses with some structure by providing a product catalogue, logistics, inventory management, customer support, and most importantly, a large marketplace for them to sell. By doing so, the company seems to have identified the main source of woe for SMEs in India — lack of working capital.
Funding gets a push
Consequently, Shopclues introduced ‘Capital Wings’, its funding platform which enables merchants to get business loans conveniently. Capital Float, a digital finance company which provides working capital finance for SMEs in India, is the financing partner. A tie-up with HDFC Bank is also in the pipeline. “In a short period of two months from its introduction, Capital Wings has received 300 applications and has already disbursed loans amounting to Rs 1.5 crore,” said Sanjay. “As intermediaries, we are able to develop confidence among merchants as well as underwriters with our knowledge of the former’s credit history, inventory, and volume of business.”
Come September, Shopclues.com will offer more services to support client businesses both online and offline. So far, it has provided SMEs with access to a nationwide market. But soon they intend to support them in widening their local markets by putting in place local delivery mechanism and inventory management. “We have lined up a series of activities this year, to strengthen our merchants’ game offline as much as online,” said Sanjay.
The CEO says Shopclues.com is looking at a great FY16 with an anticipated fourfold increase in its merchant base from the current 1.5 lakh and GMV (gross merchandise volume) of $1.5 billion from $400 million at present.