Adding water to its drowning ship, 40% of Snapdeal sellers have severed ties with the e-commerce marketplace. These 2,000 online merchants have resorted to Snapdeal’s abandonment majorly because of the accumulating dues.
All the sellers belong to All India Online Vendors Association (AIOVA) and have declared to halt their selling services till the e-retailer clears their pending payments. As reported by TOI, the pending payments amount close to ₹300 – 400 crore and currently stuck with Snapdeal.
While Snapdeal claims to engage more than 3,00,000 sellers, the online group of sellers say that the active number of sellers count to only 50,000. Over the past year, the platform bid goodbye to an ever-increasing number of merchants due to internal chaos and lack of efficient response and services. Speaking of the massive exit, a spokesperson of AIOVA said,
They will only be back on the platform if the company resolves issues and provides a written assurance.
Though the founders, Kunal Bahl and Rohit Bansal had agreed to a complete salary cut to pacify their employees, the ignorance shown towards merchants, the platform’s biggest asset, would result in massive losses. Both of them have declined to comment on the matter and are still to address a response to AIOVA.
AIOVA is an active group of e-sellers that raises concerns of suffering merchants against the e-commerce companies. The institution voices their problems on various social media platforms and demands a response on their behalf. It not only makes the matter visible to the companies but constantly addresses such issues to the commerce ministry of India. In response to AIOVA queries, a Snapdeal spokesperson said,
At Snapdeal, we work closely with our seller partners to provide them access to a huge market, data-driven analytical support and access to comprehensive logistics and payment solutions.
We have strong and robust engagement with our sellers, which helps conduct business operations in a reliable and frictionless manner.
Snapdeal executives have agreed to meet the vendors of eSeller Suraksha, an association which comprises 1,500 vendors within the coming week to discuss the rising concerns. The matter is causing trouble to these vendors affecting their overdraft facility and loan cycle. Similar is the condition of Askmebazaar and Bestdeal TV which are soon to close down, unable to clear their seller dues.
The homegrown e-commerce company is in talks with SoftBank to raise around $300 million. As per people aware of the situation, Jasper Infotech, the parent company of Snapdeal and SoftBank have been going back and forth for the last two months on crucial terms of the deal, including on the investment size and the valuation. They further said that Jasper’s board has held talks for raising funds at a valuation of $1.5-2.5 billion.