E-tailers have no solution for spikes in demand

This rush is faster than an F1 race. Unable to cope with the unprecedented festive demand from online shoppers, a New Delhi-based e-commerce logistics company has been forced to ask even its top executives to handle phone calls from irate consumers waiting for their delayed packages, suggesting that e-commerce giants and their logistics partners still have not figured out the shopping patterns of Indian consumers. And what's worse, these problems are not going to go away soon.

Says Praveen Sinha, founder and MD of Jabong: "It is impossible to gauge demand and boost capacity accordingly, especially during the festive season. You can increase your capacity from one lakh to two lakh but not to five lakh because that extra capacity is going to remain idle for the rest of the year. We can try our best but mistakes will happen. The problem is, in the fight for market share, e-tailers are accepting orders without thinking about logistics issues."

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The concerns over capacity building to handle demand surges comes in the wake of Flipkart's Big Billion Day sale debacle when stocks disappeared within seconds, orders were cancelled at the last minute and the website crashed several times, leaving millions of shoppers high and dry, and very angry. When asked about the measures being taken to cope with such demand surges, most e-tailers, including Flipkart, Snapdeal and Amazon, preferred to remain silent. Questionnaires sent to all three went unanswered.

Says Vidmay Naini, director and business head with eBay India: "It's important to be transparent and sensitize your customers about delay in delivery times. Also, one should try to get more sellers on board, work on the tech front and plan for at least three cycles (one cycle equals a festive season stretching from Diwali to New Year) in advance."

Research by UK based trend-forecasting firm WGSN reveals that Indians don't like to wait and they choose retailers on the basis of how fast they can deliver with over 60% preferring same or next day delivery. But during this festival season, shoppers had to wait for two weeks for products to arrive compared with 2-3 days during normal days.


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