ONDC: The New King is worth checking out!!
OND:- What Is It?
A non-profit online marketplace called The Open Network for Digital Commerce connects buyers and sellers with related logistics and service providers. To offer an unmatched financial framework, audience scope, and autonomy in the e-Commerce sector, the Government of India launched it. The goal of ONDC is to support the development of open networks that are independent of any particular platform, built on open-sourced methodology, and employ open standards and network protocols.
On common apps like Paytm, Blinkit, Groofers, etc., buyers can choose from a vast selection of merchants when looking for goods and food. Without spending money on digital promotion or worrying about logistical management, sellers reach the largest audience of potential customers. The groundwork for the seamless integration of customers, retailers, and logistics will be set via robust cross-sectional transaction programming.
The Indian government hopes that by avoiding a platform-centric business model, ONDC will democratise the nation’s online market for all customers and sellers, regardless of their size, giving millions of Kirana stores and small retailers an equal chance to succeed. The open network will eventually cover other industries including travel and mobility, even though activities are currently concentrated on allowing real-time transactions in the restaurant and retail sectors.
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By October 2022, 100 cities and towns across India will have ONDC installed, based on the results of the pilot exercise and once the network has stabilised. It is intended to support 10 million online retailers and 30 million online sellers.
With the long-term objectives of creating and maintaining the platform, ONDC will adjust the network’s management and regulatory rules. The ONDC’s implementation and whether it will succeed in its goals remain to be seen, despite the government’s enthusiasm. In order to determine whether they can join the open source network as well, major online retail aggregators are likewise in a wait-and-see posture.
What’s on the table is brought by ONDC and for whom?
Transparent regulations, low capital expenditures, and lower startup costs are anticipated to be advantageous to e-commerce businesses. The time-to-market and time-to-scale are anticipated to both be significantly shortened as well.
Bringing about discoverability, interoperability, and inclusivity would support both new and smaller online merchants. In order to spur innovation and alter industries like retail, food, and mobility, it will liberate suppliers and consumers from the monopoly of large platforms. With their expensive rules and onerous commission fees, e-Commerce giants provide a barrier for independent small businesses. ONDC, the market maker, was created to address this issue.
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The fact that anyone can join ONDC, even the smallest retailers in the most outlying areas, is by far its greatest advantage. Ensuring that they have an equal opportunity to deal with giant organisations, serve customers online through e-commerce platforms, and protect their businesses, will benefit small business owners.
Small, independent business owners will have more control over their operations as a result of being once again able to interact directly with their customers without being hindered by an intermediary barrier, which will boost fair trade. They will also become digitally empowered and no longer be subject to the whim of e-commerce companies with whom they have very little negotiating leverage thanks to the ONDC platform.
By simply charging you a referral commission of 3% for locating your buyer, ONDC goes above and beyond this. Furthermore, that amounts to 7 to 10 times less than the typical online sales commission rate, which ranges from 23% to 28% of the cart value. Additionally, ONDC offers unrivaled consumer reach by drawing on the user bases of numerous daily use apps.
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Conclusion:-
The Open Network for Digital Commerce (ONDC) is an innovative and daring project, but there are still a number of problems that need to be resolved, including those relating to the operational strategy, open competition, the technical ability of MSMEs (Micro, Small, and Medium Enterprises) to use the system, and clarity in responsibility allocation. A tectonic shift could occur if ONDC is successful in moving India’s e-commerce industry away from its platform-centric structure and toward a more platform-agnostic strategy.
