GST hasn’t had much impact on online sales! Crazy discounts continue

While everyone was expecting the goods and services tax (GST) rollout to put a halt o the online sales at most popular e-commerce websites, it doesn’t seem to have had much of an impact as most of these sites continue to offer as much as 80% discounts on some products.

GST was supposed to increase the price of some products, which led to vendors registered with e-commerce platforms like Flipkart, Amazon India and Paytm Mall stocking up their inventory to supplement the increased demand.

Not only this, sellers that didn’t comply with GST and have now been reportedly delisted from these platforms, also cleared their stock off at absurdly low price points.

While Flipkart is offering discounts up to 70% on various fashion products, including bags and watches on its own fashion labels Divastri and Metronaut, Amazon India is offering similar deals for global brands.

"Sellers on these marketplaces have a significant upside in volume of sales since they are able to reach customers across the country," Utkarsh Biradar, Senior VP - Products at Shopclues, told ET. "We do not see any difference in taxes on goods sold online and offline even with GST and hence consumption or demand is unlikely to change."

Similarly, customers are also inclined towards buying furniture, even as plywood now attracts 28% GST. Furniture e-commerce platform Pepperfry is holding a 'Happy GST Sale,' under which it is offering up to 55% discount, while at Flipkart, home and furnishing items are being sold at 80% off.

Even though books and cameras now attract 18% GST, Flipkart sellers are offering great deals on Canon and Nikon cameras, while those with Amazon are offering up to 50% off on certain books.

"What seems to have happened is that e-commerce sites have woken up to the fact that GST would bring uncertainty in the minds of customers on whether prices would go up or down," says Senior Director at Deloitte India, MS Mani.

"In this scenario, customers are buying products and e-commerce sites are simply tapping in on that sentiment. This has seen an uptick on sales and traders do not see any reason for those to go down, thereby continuing with their deals even after the implementation of GST," he adds.

(Image source NBC)