Rebellion on eBay
here’s a very tangible, melodramatic air that hovers around Amar Mudliar. A 35-year-old trader on the Indian edition of eBay, an online marketplace, he started out as a computer dealer. But wafer thin margins, his bankers and life in general dealt him a rough hand. He found solace among lawyers and a couple of whiskies every night.
Through the accompanying haze though, he had figured the cheapest places in the world to source electronic gadgets, automobile spares and other such assorted paraphernalia that he was convinced people would buy, if only he could show it to them.
Roughly two years ago, somebody pointed him to eBay (ebay.in). Apparently, almost 13,000 Indians like him — without too much capital at their disposal — displayed their wares at this virtual store where a few million people log in everyday. It didn’t take Mudliar long to figure out how the business works. Success was quick and it weaned him away from the alcohol. Peace followed. Until he woke up one morning and discovered the virtual store he operated on eBay had been taken off. As he looked around his apartment in Powai, a suburb in Mumbai, all he could see was a mountain of inventory worth a few lakh rupees. And desperation.
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Image: Dinesh Krishnan
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Amar Mudliar, ebay power seller. | |
Over the next few days, the real issue started to unravel. As things turned out, eBay’s policies are fine-tuned to protect the interests of buyers on the site. If a buyer is not satisfied with a vendor — say, a product doesn’t match specifications, or it isn’t delivered on time — his dismay can be articulated instantly by giving the vendor a negative rating. Once the ratings cross a defined threshold, eBay suspends the vendor.
On the face of it, the idea sounds right. E-commerce in India is littered with stories of buyers being taken for a ride by unscrupulous vendors. To that extent, eBay’s policies and paranoia, imported from its experiences in other parts of the world, has worked and helped it create a brand that buyers have grown to trust. But because India is such a quirky country, the buyer protection programmes have had unintended consequences: Collateral damage in the form of vendors like Mudliar.
When Mudliar got into business, most of his buyers on eBay originated from Tier I cities. Over the last couple of months though, he started to notice a new trend. Fresh buyers were coming in from Tier II and Tier III towns in the country. In most parts of the world, more buyers ought to translate into more sales, therefore more money and subsequently more happiness for everybody in the chain. But life rarely pans out the way you imagine.
The Logistics Logjam
“I started to get orders from people in God-forsaken areas who don’t know the difference between a demand draft and a cheque, let alone internet banking,” fumes Mudaliar. What, you may wonder, is the problem with that? Simple one actually! When somebody from Mungra near Badshahpur in Uttar Pradesh sends him a cheque, it takes a few days for the mail to deliver it to his Powai office. Because it is an outstation cheque, the Mumbai bank takes some more days to clear it. Not just that, Mudliar has to pay the bank’s processing fee. When it’s a low-value item, this fee eats into his margin. By the time the process is completed, he’s already past the deadline to ship the product — which translates into him violating eBay’s service level agreement.
“The buyer sent me a cheque on December 22. I received it on 29th. By the time it was cleared, it was January 6. By which time, the buyer was upset and on January 9 he gave me a negative rating. Soon after that, I was restricted from selling anything more,” he complains.
Yet another power seller on eBay, who did not wish to be named, said the problem is amplified when it comes to delivering the product. He talks of the time he received an order for a new mobile phone, again from an address in UP.
Major courier companies do not have service locations in small towns. They invariably end up sub-contracting work to mom-and-pop shops that promise to service these places. Very often they are sloppy, deliver late, end up mishandling goods and are rarely accountable.
By the time the buyer got his hands on the phone, it was too late and mangled beyond recognition. The buyer demanded a refund and marked the vendor as an unreliable one in eBay’s system. On its part, eBay took note of the complaint and eventually penalised the vendor. Who’s to blame? Nobody was wrong. It was simply the system that failed to function.
Ambareesh Murty, country head of eBay India, is quick to acknowledge the problem. Globally, the eBay model works on multiple pick-up and drop-off points. No single company in the country has the muscle to offer a logistics solution that can resolve the problem — except, of course, India Post. “We are in talks with India Post,” says Murty. “But it’s too early for me to confirm anything will come out of it.”
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I didn't even realise that these problems existed.
I sure am hoping for a better tomorrow for e bay sellers, without any compromise being made for the buyers protection.
