A key outcome of the technology revolution in India has been connectivity, which has fuelled unprecedented access to information. Millions of people who had little means to join the national discourse can now gain new insights into the world around them. Farmers know crop prices. Consumers understand global standards of product and service quality. Rural Indians recognise the differences between the opportunities available to them and those available to their urban counterparts. And citizens have forums for expressing their opinions. The upshot of this connectivity revolution has been empowerment of Indians.

Along with 4G telephony, internet penetration is soaring in rural and urban India. The Indian government’s ambitious Digital India project and the modernisation of India Post has also affected the e-commerce sector. The Digital India project aims to offer a one-stop shop for services that have the mobile phone as the backbone of its delivery mechanism. The programme gives a strong boost to the e-commerce market as it brings the internet and broadband to remote corners of the country to give rise to an increase in trade, efficient warehousing and a potentially huge market for goods to be sold.

For India Post, the government has developed its distribution channel and other e-commerce related services as a major revenue generation model. The India Post has recently transacted business worth 280 crore INR in the ‘cash-on-delivery’ segment for firms such as Flipkart, Snapdeal and Amazon. Both these projects have significant impact on increasing the reach of e-commerce players’ thereby boosting growth.

Indian companies realise this, and are therefore aiming to continue their focus on expanding sellers and buyers on their platforms, innovating on multiple customer touch points and providing seamless and rapid delivery services in order to compete with the international entities.

This is the current state of the e-commerce landscape in India – the necessary technology is available and industry has access to funds from within the country including financial institutions, angel investors and venture capital as well as international investors. It provides an excellent climate for start-ups. And start-ups can also be managed without investor’s money which saves the businesses from external interferences. Following are some such start-up models:

1. Matchmaker Model brings together the buyers and sellers with the matchmaker never touching what is bought or sold. He/She is paid by commissions from buyer or seller or both. The business is typically run on line. So like all the following models, it needs a ‘code’ or software to drive it. You may write it or team up with somebody who can write it. This ‘code’ is also easily available on line and is quite inexpensive. AIRBNB, OLA and UBER are examples of this model. A study of these businesses can be useful if you can identify a ‘demand’ somewhere (accommodation in case of AIRBNB) and ‘means’ (spare accommodation with somebody who is ready to share it) to fulfil the demand.

• Pay in Advance Model is the most straight forward and easy to adopt business model without involving your money. The sellers and buyers pay in advance before the goods or services are created, produced or delivered to the buyers.  You pay in advance for your holidays, air travel etc. That means seller gets money before you get services. In constancy, there is always down payment at least partially in order to get services. PAYTM is a model where you first put in money in your account and then you can pay from your smart phone – the PAYTM gets money in advance.

• Subscription Model is most familiar model. You subscribe for TataSky, periodicals that are delivered to your doorstep or digital inboxes. Organic vegetables, healthy snacks and fruits are delivered each week on subscription basis. The customer agrees to buy goods or services that are delivered physically or digitally and paid as subscription for extended period of time.

• Scarcity Model works on restricting the availability of goods for sale both in quantity and time. The sellers and suppliers are paid after the sale is made – when goods are gone and very importantly there won’t be any more. ZARA shoppers know that if they like something in store, they buy it or if they miss, they may never get it. The customer pays money but ZARA sellers does not pay its suppliers for typically 60 days. This provides ZARA with boatloads of money with which it opens more stores. MANGO, MAYANTA are other examples of such arrangements.

• Service to Product Model works where service business is already funded by customers. You like to scale up your services and make them available to other customers as products. It was Bill Gates who provided the service for one customer, then slightly different version for other customer. He got an understanding of customers’ needs in that area. For Bill Gates it was operating systems for computers. He developed a standardised version that works for lots of his customers and he begin selling it as a product. Therefore in this model upscaling of existing service business is done.

All the models, customer has to be in the centre. A demand is to be identified and then the business is about how to fulfil it.