Introducing the E-commerce Sustainability Quotient Matrix

In a war to capture that fleeting consumer loyalty, most e-commerce stores in India are currently operating in the deep-discounting mode and nearly all are running into huge operational losses. However, as the industry matures, e-commerce companies would need to start focusing more on improving profitability by reducing operating costs and improving resource efficiency, says Sustainability Outlook.

E-commerce is changing the way people shop globally. Over the last two decades, multi-billion dollar e-commerce companies have come into being. Even as they see increasing scale and success, e-commerce companies have not turned their focus on environmental sustainability in stark contrast to the initiatives on sustainable production and consumption undertaken by world's leading retailers like Walmart and Ikea.

Realising the acute need for the e-commerce industry to start thinking about their environmental impact, Sustainability Outlook delved deep into e-commerce operations to create an E-commerce Sustainability Quotient Matrix. The E-commerce Sustainability Quotient Matrix will help guide e-commerce companies to assess their preparedness and current state when it comes to environmentally sustainable operations. This matrix also provides an indicative path that e-commerce companies should embark upon to make their operations greener.

The e-commerce scenario in India

E-commerce has suddenly exploded in the Indian marketplace. What was a non-existent concept ten years ago is now a US$ 3.5 billion industry with about 20 million active users and an annual growth rate of 34 per cent. Flipkart and Snapdeal have set targets of Gross Merchandising Value (GMV) of $8 billion and $10 billion respectively for 2015 as the market gets ready to see even greater growth. Brick-and-mortar stores are already feeling the heat as young Indians are now choosing the comfort of ordering from homes (at high discount levels) instead of physically visiting stores for shopping. This applies to everythingfrom clothes, shoes and jewellery to mobiles, laptops, and quite interestingly even furniture, air-conditioners and refrigerators.