Tag Archives: e-commerce

e-com operators

update from CBIC twitter handle

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Failing to Succeed

This is undoubtedly one of the best business books that i have read for a long long time. K. Vaitheeswaran’s story of founding India’s first ever e-commerce company Fabmart.com which later became Indiaplaza.com, its true success and its subsequent failure. Vaitheeswaran has written the book with as much emotions and integrity as he put into building the business. Very nice flowing narrative with lot of stories with a little dash of humour here and there. This is a first class primer on how to set up an e-commerce company, a true e-commerce company based on profitability i.e. not on insane valuations that we are seeing these days, the soonicorns, unicorns and the gonicorns. Vaitheeswaran is scathing in his indictment of the fake start up culture in India, i.e based on sky high valuations and some funny metrics, high cost employees having zany designations, deep discount strategy etc. He says “several unicorns have pursued the LMS (Last Man Standing) strategy so far with enthusiasm by raising humongous amounts of capital, pricing their products and services well below cost that pushed several competitors out of business.” Another gem “the purpose of business is to make money, not raise money” and another one “Entrepreneurs must treat their start-ups like children” alluding to the investors’ craze to create pop-bubble valuations which are again based on crazy metrics like head count to the detriment of creating a profitable sound business. The most important of all traits for an entrepreneur is integrity, he says in page 195 “at a start up event, when asked what would be the one thing i would look for in any entrepreneur, i said integrity” Vaitheeswaran’s angst is mostly on the investors who let him down time and again and badly too. They just left him in the lurch, and it was sad to read the latter part of the book which deals with the failure of his portal and the severe problems that came with it. And this for a person who is virtually the founder of an industry – e-commerce, was founded by him and friends with nothing to learn from – even programmers did not know how to write codes for creating an e-commerce web site. Fabmart was a pioneer in India in those days when nobody knew anything about e-commerce. This book should be made must read in all MBA syllabus in the country – must read for all the wannabe capital advisors, entrepreneurs alike – it has so much of wealth of information you will not find in any text book on business. Goodreads 5/5

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Country of origin

Govt. has mandated vide their press release dated 23rd June, 2020 that sellers on the Government e-commerce site have to mention the country of origin of their products while registering all new products and existing sellers have to also list the country of origin of their products, failing which they will be removed from the Government e-market place. https://pib.gov.in/PressReleasePage.aspx?PRID=1633511

In my view this is blatantly discriminatory. Govt. should fight its political battles on its own, without involving the industry in this matter. There may be lot of companies who may be contractually obligated with their Chinese counter parts, govt. should realise this, otherwise the fight will go to the arbitration and civil courts. The best thing that govt. could have done is allow all such companies to finish their contractual obligations and then dissuade them from trading or dealing with certain countries. Tomorrow if the govt. starts with fighting with a dozen countries, then they will disallow trade from those countries. In today’s inter-connected world, it is virtually impossible for any country to be completely self isolated like South Korea was at one time.

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Consumer Protection Bill 2019

PIB press release dated 30th July, 2019

The Lok Sabha today passed the Consumer Protection Bill 2019 after due consideration and discussion.The Union Minister for Consumer Affairs, Food and Public Distribution Shri Ram Vilas Paswan said that the bill aims at protecting the interests of consumers by establishing authorities for timely and effective administration and settlement of consumers’ dispute. Moving the Bill, Minister of State for Consumer Affairs, Food and Public Distribution, Shri Raosaheb Patil Danve said the Bill aims to simplify a number of rules. Shri Danve said consumers do not get quick redressal of their complaints and with the passage of the Bill, consumers will be able to get speedy justice. He said the government aims to simplify the entire process of redressal of consumer grievances.

Under the Bill, there is provision for central government to set up a Central Consumer Protection Authority (CCPA) to promote, protect and enforce the rights of consumers and will be empowered to investigate, recall, refund and impose penalties. It will regulate matters related to violation of consumer rights, unfair trade practices, and misleading advertisements. There is also a provision for class action law suit for ensuring that rights of consumers are not infringed upon. The authority will have power to impose a penalty on a manufacturer or an endorser of up to 10 lakh rupees and imprisonment for up to two years for a false or misleading advertisement.

Salient Features of the Bill

1.         Central Consumer Protection Authority (CCPA): Executive Agency to provide relief to a class of consumers. The CCPA will be empowered to-

  1. Conduct  investigations into violations of consumer rights and institute Complaints /Prosecution
  2. Order recall of unsafe goods and services
  3. Order discontinuance of Unfair Trade Practices and Misleading  Advertisements
  4. Impose penalties on Manufactures /Endorsers /Publishers of Misleading Advertisements

2.         Simplified Dispute Resolution process

i) Pecuniary Jurisdiction enhanced to-

  • District Commission –Up to Rs1 crore
  • State Commission- Between  Rs1 crore and Rs 10 crore
  • National Commission –Above Rs.10 crore

ii) Deemed admissibility after 21days of filing

iii) Empowerment of Consumer Commission to enforce their orders

iv) Appeals only on question of law after second stage

v) Ease of approaching consumer commission

  • Filing from place of residence
  • E-filing
  • Videoconferencing for hearing

3.         Mediation

  • An Alternate Dispute Resolution (ADR) mechanism
  • Reference to Mediation by Consumer Forum wherever scope for early settlement exists and parties agree for it.
  • Mediation cells to be attached to Consumer Forum
  • No appeal against settlement through mediation

4.         Product Liability

A manufacturer or product service provider or product seller to be responsible to compensate for injury or damage caused by defective product or deficiency in services

The Basis for product liability action will be:

  • Manufacturing  defect
  • Design defect
  • Deviation from manufacturing specifications
  • Not conforming to express warranty
  • Failing to contain adequate instruction for correct use
  • Services provided arefaulty, imperfect or deficient

New Bill- Benefit to Consumers

Presently Consumer only have a single point of access to justice, which is time consuming. Additional swift executive remedies are proposed in the bill through Central Consumer Protection Authority (CCPA)

Deterrent punishment to check misleading advertisements and adulteration of products

Product liability provision to deter manufacturers and service providers from delivering defective products or deficient services

Ease of approaching Consumer Commission and Simplification of Adjudication process

Scope for early disposal of cases through mediation

Provision for rules for new age consumer issues: e-commerce & direct selling

 

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