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Indian Sellers to Get Access to 5 Million Chinese Goods with Paytm’s Help Through Alibaba

| Jun 28, 2016 11:49 PM EDT

Employees of Snapdeal, an Indian online retailer, check packages for delivery in an office in Mumbai.

Indian sellers may soon be able to get access to Chinese products at cheaper rates, as well as assistance on logistics and payment, with the help of e-commerce platform Paytm, using the latter's connection with Alibaba, The Economic Times of India reported.

Paytm said that the program will be tried on about 25 to 30 Indian sellers engaged in home and kitchen, micro innovation including USB cookers, fashion and mobile accessories, and western fashion. By the end of the year, at least 10,000 merchants will be included in the plan and they will have access to more than 5 million Chinese products.

"Inventory is the third pillar of commerce, after logistics and payments, which requires optimization in India," Bhushan Patil, head of the Paytm plan, said.

The Indian e-commerce firm said it aims to boost its B2C business by helping sellers get products more effectively and gain more from it.

Patil, who was formerly head of Alibaba Group Holding's wholesale international business before he joined Paytm three months ago, said that sellers who use Paytm can also sell on other marketplaces such as Amazon, Flipkart, Snapdeal and ShopClues.

"We expect the Indian SME's cost to come down three times with our direct connect," Patil said. "Most SMEs don't import directly, they import from local distributors, and there may be 2-3 steps shuffling, we connect directly. We also offer bonded warehousing facilities, leveraging our tie-ups with import houses and trusted payments with our partnership with Citibank, which further reduces costs at scale."

Patil added that sellers can also take extra capital to buy additional products through Paytm's lending program, to meet consumers' anticipated demand.

"Sellers can buy in bulk from China at cheap prices, get goods to India and store in our bonded warehouses until products need to be sold. That way the seller pays duties, which are close to 30 percent at the time of sale and not in bulk," Patil explained.

Patil said Alibaba may support the plan with its expertise once it turns out successful as it could help Indian sellers offer new products on Paytm at competitive prices.

"IndiaMART is focused on domestic B2B, serving buyers and sellers in India," said Brijesh Agarwal, cofounder of IndiaMART, which owns 70 percent of the market share in the online B2B commerce. "Alibaba & Paytm are working on helping Indian buyers connect with suppliers from China and buy from them. Both of us are serving different segments of the market."

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