Amazon aims to pacify small traders with $1bn SMB bet

New Delhi, Jan 15
Amazon's $1 billion commitment to empower small and medium businesses (SMBs) in India is Jeff Bezos' attempt to change the e-commerce giant's perception among small businesses which are in a retaliatory mode, industry experts said on Wednesday.

Bezos announced that the e-commerce major, through its global footprint, will help SMBs export products worth $10 billion by 2025.

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This move is seen as a measure to calm the growing unrest and protests going on under the aegis of the Confederation of All India Traders (CAIT).

"Amazon wants to make sure that the current perception of the company among the small businesses go away, else this will further call for strict scrutiny from the regulators and protests from small traders," Satish Meena, Senior Forecast Analyst with Forrester, told IANS.

Over the next five years, Amazon will invest $1 billion to digitise micro and small businesses in cities, towns and villages across India, helping them reach more customers than ever before, announced Bezos.

According to Meena, this is in line with what Amazon is planning to do in India for the next few years.

"They need partnerships with SMBs for products to cater not only to the Indian customers, but also to customers outside the country," he said.

Amazon said it would establish 'Digital Haats' in 100 cities and villages to help businesses integrate into the digital economy.

According to Prabhu Ram, Head, Industry Intelligence Group (IIG), CMR, SMBs in India account for 45 per cent of industrial output, creating employment for 60 million Indians and roughly 1.3 million jobs annually.

"The SMBs, however, are constrained by multiple challenges, including access to skills, talent, finance, and most importantly, digital outreach," Ram told IANS.

"This is where SMB-centric initiatives, such as Amazon's commitment, are a welcome initiative to digitally support SMBs, enabling them to gain knowledge, reach their target audience, achieve scale, and while doing so, be able to measure their growth metrics," Ram said.

In the end, added Meena, SMBs in India also need handholding in product development, capital investment and access to market.