Singapore firms see growth in e-commerce in India amid Covid-19 pandemic

The pandemic is expected to accelerate India's e-commerce market and push growth to 7 trillion rupees (S$126.5 billion) by 2023. PHOTO: REUTERS

NEW DELHI - Singapore food manufacturer Tong Garden saw its business in India grow over the last decade - mainly through supermarket and grocery stores, where people would pick up snacks like wasabi-flavoured peas, a surprise runaway hit among Indians.

During the pandemic, the snack and nuts company has increasingly looked to e-commerce.

"Early on we were on Amazon and Big Basket... Through the pandemic, we saw sales on all our platforms surging. That is something we are thankful for. We realised we need to put in even more to grow our presence," said Tong Garden spokesman Huiqi Ong, noting however, that overall sales in India had fallen 20 to 30 per cent during the pandemic.

She added: "We are really focused on increasing our reach and being on as many platforms as possible."

Plans to set up a manufacturing plant in the city of Ahmedabad have also been delayed by the pandemic.

The plant, announced over two years ago, would allow the firm to manufacture its products in India and make it more competitive in an extremely price-conscious market.

While building in the midst of the Covid-19 pandemic is "very challenging", they are going ahead with building the factory.

Ms Ong said: "There is a lot of potential (in India) - it's a big market for us."

India is the second most affected country in the coronavirus pandemic, with 9.31 million cases.

The country in March saw a stringent lockdown shutting down all economic activity, though restrictions have since eased.

Still, the pandemic has seen middle and upper classes increasingly shift online to buy everything from vegetables to daily essentials.

According to data analytics firm GlobalData, the pandemic is expected to accelerate India's e-commerce market and push growth to 7 trillion rupees (S$126.5 billion) by 2023.

For Singaporean firms selling lifestyle and food products, e-commerce has acquired additional importance for expanding business.

Singaporean firm Igloohome, which makes smart locks and lock boxes, moved up its plans to go online.

"E-commerce was in the pipeline but was brought forward due to Covid-19. We assisted distributors to get on board marketplaces like Amazon and Tata Cliq by partnering with e-commerce focused resellers," said Mr Shalin Gaikwad, director of business development, Igloohome.

"This helped us tap into the festive promotions during Diwali, and we were able to list a lightning deal on Amazon, which led to some unprecedented volumes during the festival season."

The firm found that while deals in the real estate space were put on hold, other industries opened up like the logistics industry.

"We decided to conduct training sessions with our distributors and gave them case studies on how to cater and pitch to this newly created stream of demand," said Mr Gaikwad.

Despite seeing a dip in sales during the pandemic, Igloohome said it plans to increase its retail presence in the five major metropolitan cities by March 2021.

Enterprise Singapore, the government agency championing enterprise development, has spotted the benefit of e-commerce for firms seeking to expand.

It recently conducted a webinar on e-commerce journey for Singapore companies keen to venture into India.

"Despite the challenges posed by Covid-19, ESG has engaged with more than 40 companies on e-commerce opportunities in India to understand more about the opportunities and landscape over the past few months.

More than 47 per cent of these companies have progressed on to have active discussions with in-market distributors and sellers," said Mr Tay Lian Chew, global markets director for South Asia, Enterprise Singapore.

He noted that India continues to "present opportunities for Singapore companies with a mid to long-term perspective".

"The ongoing pandemic as well as trade tensions has also highlighted the importance of diversifying supply chains as companies around the world faced disruptions to the flow of materials and goods."

India has a tough business environment due to red tape and regulatory hurdles among others. Still, the country jumped from 130th position in 2017 to 63rd in 2020 in World Bank's Ease of Doing Business Index.

For beverage firm Asia Farm, e-commerce is a new strategy for India after eight years of trying to crack the highly competitive beverages sector. It has sold 12,000 bottles of purple tea online during the pandemic.

"We understand the India market is not really easy because it's price sensitive, said Mr Wong Loke Hsien, its business manager.

"But once you get in and the product is well accepted, sales can be big because of the massive population."

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