E-commerce regains 30 per cent of pre-lockdown order volume, says Unicommerce

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Online commerce platforms are estimated to have regained about 30 per cent of the pre-lockdown order volume in the last one week after relaxations were eased in the third phase of lockdown, a report by Unicommerce eSolutions said on Tuesday.

Unicommerce is an e-commerce focused supply chain solutions provider, and claims to process over 20 per cent of the country's e-commerce volume.

Its clients include Myntra, Bulbul TV, Urbanclap, Forever New, House of Anita Dongre, Jack & Jones, Vero Moda and others.

The company said it processes 4 lakh order items a day, amounting to over USD 2 billion (about Rs 15,000 crore) in gross merchandise value.

"The overall e-commerce sector showed a good sign of recovery in the first week of lockdown 3.0 and made up for the steep decline of 40 days due to lockdown. The overall industry has reached 30 per cent of pre-lockdown order volumes which is a good sign for the industry," the report said.

However, business will continue to take a major hit as over 40 per cent of the e-tailers are based in metropolitan cities which are currently in the red zone, it added.

E-commerce companies have been permitted to sell all items in orange and green zones starting from May 4, 40 days after the nationwide lockdown was imposed on March 25.

In the first two phases of the lockdown, e-commerce companies like Flipkart, Amazon and Snapdeal were allowed to sell only essential items like grocery, medicines and healthcare products.

In the red zones, that include top e-commerce hubs like Delhi, Mumbai, Bengaluru, Pune and Hyderabad, e-commerce companies can still ship only essential items.

"The online fashion sector is one of the major contributors to overall India's e-commerce volume and growth. It includes apparel, footwear, bags, and accessories and has suffered the maximum impact due to the coronavirus pandemic.

"During the first seven days of lockdwon 3.0, the sector has recovered 30 per cent of its pre-lockdown order volumes," the report said.
It added that the segment is expected to see further growth in the current week, as it took a couple of days for retailers to get back into the business.

The fashion sector is expected to see the next big jump once e-commerce operations begin in metro cities, considering all metro cities are presently under the red zone, the report said.

Order volume for electronic appliances increased significantly, with recovery rate of 35 per cent in the first week of the third phase of lockdown.
It added that there has been a 5-7 per cent rise in the average order size compared to the week before the lockdown was announced in March.

Given that eyewear was placed under the essential category, online eyewear players continued to operate during the lockdown as well.
"During the lockdown, the number of orders for eyewear decreased by over 60 per cent despite multiple promotions by leading online eyewear players.

However, the order volume has increased by 70-75 per cent as compared to a week before lockdown 3.0," it said, adding that consumers were probably not aware that eyewear products operate under the essentials category.

For the cosmetics category, some products were available under the essentials category

"However, the order volume declined by almost 90 per cent during the time period. In the first week of lockdown 3.0, the cosmetics sector has not shown any significant signs of recovery, as the sector has only been able to regain 15-20 per cent of its order volumes.

"Having said that, the sector is expected to recover but will take a slightly longer time than usual," the report said.

E-pharma and online grocery sector witnessed a massive spike of 100 per cent spike during the first two stages of lockdown, with the average order size increasing by 20 per cent, it added.

"However, there has been a negligible change in the number of orders in the last one week, beyond a spike of 7-8 per cent in the overall order size as people may have already stocked up medicines and grocery items. The lockdown is expected to result in a major boost for the sector in the current financial year," it said.

Unicommerce CEO Kapil Makhija said the last 40 days have had a major impact and changed people's mindset about online shopping.

"Even though the government has permitted certain activities, consumers are still wary of leaving the house and have adopted social distancing as a way of life. The essentials category has witnessed a major surge during the 40-day lockdown and will continue to see an increase in the overall demand," he said.

With certain relaxations in the non-essential sales in green and orange zones, a similar growth is being seen in other sectors, he said, adding that e-commerce industry is expected to see a steep increase in orders in the long run as consumers would adjust to the new norms post-lockdown.

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