Introduction
The government of India has created the Open Network for Digital Commerce (#ONDC) in an attempt to put an end to the dominant profiles of the US-based corporations Amazon.com and Walmart in the rapidly developing e-commerce industry.
Regardless of its use, the ONDC platform tries to connect and trade with buyers and sellers online. Two domestic companies reportedly controlled more than half of the nation's e-commerce activities in 2021, limiting competition, favoring certain vendors, and reducing supplier margins. Because of this, ONDC works to create an equal playing field for all participants.
What is ONDC?
The term #ONDC is not unfamiliar to small business owners who engage in online commerce. However, I'll only give a quick overview of #ONDC. A private non-profit corporation called ONDC was established with the goal of uniting all small enterprises to democratize the nation's online market for all buyers and sellers, providing millions of micro businesses and mom-and-pop (#Kirana) shops an equal chance.
Why does the Government Support the ONDC Concept?
The government is hoping that ONDC will end the e-commerce industry's utter dominance of a small number of massive platforms. According to the report, these platforms currently control and operate in "silos" inside the e-commerce business.
For example, #Amazon and #Flipkart have come under fire for allegedly discriminating against sellers on their marketplaces and promoting certain seller businesses in which they have an indirect stake. According to the government, an open network like ONDC that links buyers and sellers on different platforms would level the playing field and make platforms obsolete. According to reports, customers would be able to visit merchants on different platforms without switching between them.
The following are the primary goals of ONDC:
Ending platform monopolies
Democratization and decentralization
Digitization of the value chain
Standardization of operations
Inclusivity and access for sellers - particularly small and medium enterprises and local businesses
Increased efficiency in logistics
More choices and independence for consumers
Ensure data privacy and confidentiality
Decreased operational costs
Solving these problems for a country with a massive population requires a new approach. Technically speaking, a transition from an operator/platform-centric paradigm to a platform-driven model and then an interoperable decentralized network was needed.
What this means for small and medium enterprises (#SME) is :
Boost to participate in the ONDC network
Better discoverability6 and trust, irrespective of the platform(s)
Autonomy of buyers and sellers
The ONDC is not limited to only retailers but can be applied to other digital commerce areas like mobility, food delivery, logistics, travel, and other products and services.
Conclusion
By creating a level playing field for all companies, ONDC hopes to democratize the Indian e-commerce market. Currently, a consumer who has only one portal linked to them can only make purchases from that portal. He has to go to another portal to make a purchase from another portal, however on this network, he is totally free to make product purchases or services from any firm without entering into another e-commerce platform.
Despite the various challenges, #ONDC will try to overcome them once genuine implementation begins.
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