Gurgaon based Snapdeal used to claim over 300,000 sellers on its website as of last count. However sources said that most of these sellers are inactive and are nothing but a registered PAN Card and TIN (tax identification number) of an offline merchant.
Company sources told Moneycontrol that only 10 percent of these sellers are active on a daily basis and the company is now only going to focus on these 30,000 odd sellers than try to onboard more.
Many of the inactive sellers have not even sold a single product on Snapdeal in last twelve months. However Snapdeal still used to count them as ‘sellers’ on its platform, sources said.
The company has already disclosed that it will be doing away with discounts on commissions and sales for both sellers and buyers.
Sellers say that the sales were already hit due to demonetisation and now with increase in commissions, the impact will be felt much more.
“Diwali was a good period for us as Snapdeal spent a huge sum on marketing. After demonetisation sales are down as most of the companies have increased shipping cost, warehousing costs. Some are even charging packaging costs. Our sales on Snapdeal have been down drastically,” said a Delhi based seller of health devices on Snapdeal.
The commissions on health products on ecommerce sites, she disclosed have also been increased from 8 percent few months ago to now over 15 percent.
This is deterring more sellers to join the online marketplaces as they are getting squeezed for prices.
The All India Online Vendor Association has already written to Minister of State for Commerce and Industry Nirmala Sitharaman with their concerns. The online vendors have already suffered a huge impact with the vanishing of AskMeBazaar which owed them dues of over Rs 100 crore.
As per a report, the vendors exposure to Snapdeal could be the tune of Rs 200-300 crore.
However, Snapdeal has dismissed the rumors and said that all dues are being settled in time.
