A Project report

On
Purchasekaro Sellers Life Cycle, Inventory
Management & Order Processing
at

In partial fulfilment of the requirement of Summer Internship

Programme
In
Masters of Business Administration (Operations)

Submitted by: Project Guided by:

Yash Vijaykumar Jani Mr. Harsh Maheta
Roll no: 21 Chief Operations Officer,
Batch: 2017-19 Purchasekaro.com

M. S. Patel Institute of management Studies

Faculty of Management Studies, Baroda
The M.S. University of Baroda
 ACKNOWLEDGEMENT

I hereby sincerely thank to Professor Dr. Jayrajsinh Jadeja (Dean, Faculty of

Management Studies, The M.S. University of Baroda) for providing me this
opportunity of Practical Studies in the form of Summer Internship Programme.

I have done this summer internship with kind help & support of Mr. Harsh Maheta
(Chief Operations Officer, PurchaseKaro.com). I would like to thank him for giving
me this wonderful opportunity to work & learn new things. I also thank him for making
all kind of arrangements to carry the training successfully and for guiding and helping
me to solve all kind of queries regarding this training programme. His systematic way
of working and incomparable guidance has inspired the pace of the training to a
great extent.

My extended and sincere thanks to Ms. Smita Trivedi (Assistant Professor,

Faculty of Management Studies, The M.S. University of Baroda) for giving me an
opportunity to undergo the Summer Internship at PurchaseKaro.com & enlightening
me with the project & helping me out as and when required.

I would like to thank all my subject professors who gave me guidance to understand
the topics related to this internship programme. I acknowledge them for their support
which they showed in clearing up all my doubts & giving me a clear vision.

I would like to thank my parents for their invaluable support throughout my life.

Thank you all who supported me either actively or passively and without whom this
internship programme can’t be completed smoothly.

Yash Vijaykumar Jani

 DECLARATION

I, Yash Vijaykumar Jani hereby declare that this report is prepared on the basis of
research project done by me, as a part of my Summer Internship Programme, at
‘PurchaseKaro.com’. I ensure about the authentication of the content and facts used
in the report. I assure that the data taken will be used only for academic purposes
and will not be used for commercial or any other purpose. Suggestions mentioned in
the report are as per my opinion, which are based on findings, and are correct to the
best of my knowledge.

Yash Vijaykumar Jani

 INDEX

Title Page No

1 Introduction of E-Commerce Platform 1

2 History of E-Commerce
2.1 Global History of E-Commerce 6
2.2 Indian History of E-Commerce 7

3 About PurchaseKaro.com 8

4 PurchaseKaro Sellers' Life Cycle 9

5 Inventory Management at PurchaseKaro 14

6 Pricing of Products 22

7 Order Processing at PurchaseKaro 24

8 Research Methodology
8.1 Data Collection 25
8.2 General Statistics 25

9 Key Findings 26

10 References 27
 1. Introduction of E-Commerce Platform

Technology word has originated in early 17 th century from the Greek word
“Tekhnologia” which means ‘systematic treatment’. Technology means a systematic
treatment of our problems. One of such technologies is World Wide Web. Yes, I am
talking about Internet. There are lots of applications of internet to make our lives easier.

One such application is E-Commerce. By definition, E-commerce or Electronic

commerce, is the buying and selling of products or services via the Internet. There are
many retailers who are selling products online, like Flipkart, Amazon, PayTM, TataCliQ,
PurchaseKaro, etc.

These E-Retailers provide platform to the sellers. That is why these E-Retailers
are called as platform providers. Local retailers have some limitations like, their
customers are local. So, customer reach is limited. Another limitation is that, there are
many steps in a distribution channel. So, local retailer’s profit margin is limited. And,
Prices at which they sell is also higher.

Platform providers overcome these both limitations. They provide a customer

reach all over country and sometimes globally too. Also, seller does not need any special
warehousing facility. One can sell from his/her home also. And, as platform providers
provides them higher distribution network, it is obvious that it will result in more sales.
More sales means more profit. So, this is how platform providers help sellers expand their
business.

A good platform provider has be consider mainly three aspects: Quality of a

product, Logistics – Delivery of product and Catalogue – A good variety or range of
products. If a customer purchases any product online and is not satisfied with product
quality, he/she does not purchases from that website again. And, if a customer is satisfied
with product, he/she will make purchase from that website only and also promote website
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by word of mouth. So, the quality of a product is considerable factor of any E-commerce

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website. Second factor is delivery. If a company fails to deliver product on said date, or
takes more time to deliver product, it may cost a customer for each delayed delivery. And,
last factor is a good Catalogue. A customer is loyal to an E-commerce website,
Company delivers the product before many other competitors. But, what if a website does
not have a product customer is looking for. So, large variety and range of products is
good for E-commerce Company.

Platform providers can be classified into three types according to its sellers and
buyers: B2C Retailer, C2C Retailer and B2B Retailer. Like, Amazon, Flipkart,
PurchaseKaro, etc. are B2C E-Retailers. On these websites, regular business retailers
can register themselves and their customer is individuals. E-commerce websites like
OLX, Quikr and Car24 let individuals sell their used products online. So that, other
individuals can buy those products. E-commerce like IndiaMart are third type of platform
providers, B2B platform providers.

Platform provider like Ebay used to give B2C and C2C retailing services.

Platform providers can be classified according to their warehousing facility also:

Pure Market Place, Pure warehousing and Hybrid. 1) Pure marketplace does not own
any warehousing facility. 2) Pure warehousing platform provider owns a warehouse
and stores each product to be sold on website. So that, product delivery can be fast. 3)
Hybrid platform providers are many. Their structure are combined of pure market place
and pure warehousing. Their merits and demerits are listed on next page: 2
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 Pure Marketplace Pure Warehousing Hybrid platform provider
platform provider platform provider
Doesn’t own warehouse Owns warehouse
Initial cost is lower Initial cost is higher
Running cost is very low Running cost are much
A combination of both
higher due to maintenance
of warehouse
Inventory cost is zero Inventory cost is much
higher
E-commerce company is E-commerce company is
not accountable for any accountable for loss or
loss or damage due to damage due to accidents
accidents.
Ownership of products lies Ownership of products lies
with seller. with platform provider.
Delivery time is higher. Delivery time is much less
as product has to be deliver
from warehouse only.
Quality assurance of Quality assurance of
product cannot be possible. product can be done by
platform provider.
This type of platform This type of platform This type of platform
provider can exist. provider is ideal. This type provider can exist.
of platform provider cannot
exist.
PurchaseKaro, IndiaMart, Amazon, Flipkart,
OLX, Quikr, etc. Snapdeal, etc.

Difference between pure marketplace, pure warehousing platform provider and

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hybrid platform provider

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 High number of sellers is a good option for platform provider. As high number of
sellers of same product on single website creates a competition among them. And that
leads to lower prices. Lower prices means higher sales. And higher sales means higher
profit for E-retailer. So, higher number of sellers is a good for E-retailers.

Also, while selling on E-retailing websites, seller has to face a competition with
other sellers of same product. So, to win over this competition, a seller can keep prices
lower to other sellers. Another thing a seller can do is providing freebies, like, buy 2 get
3. And, a good quality has always helped seller to keep getting benefit of customer loyalty.

Percentage of E-commerce sales with years

Above chart shows that with each proceeding year, percentage of E-commerce
sales is increasing. But, still amount of E-commerce sales in each year is very small.
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There are main four reasons behind less E-commerce sales: Connectivity, Logistics,
education and quality of goods.

After the entry of Jio, connectivity of Regions has increased. But, still our nation
has a lot of remote areas where internet is not available. So, until the connectivity is
strong, E-commerce sales cannot rise above some level. So, connectivity is major
reason for lower E-commerce sales.

India has very rough geometry. So, it is very difficult to deliver products to each
and every corner of the country. So, logistics is constrain for E-commerce industry when
we talk about remote areas.

There are many people who do not know how place an order online or make an
payment online. So, not sufficient education about online shopping in a public is a
limitation for E-commerce industry to grow.

There are many people who do not trust the quality of online products. Because
by looking at a picture, one cannot get the actual quality of a product. And, it sometime
happens that some sellers sell their duplicate products in the name of original brand. So,
quality of a product is a major factor limiting E-commerce growth.

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2. History of E-Commerce

2.1 Global History of E-commerce

Year Event
1990 The first ever web called WorlWideWeb was released. Those
who have access to the internet can now browse E-commerce
platform with ease.
1994 Book stacks unlimited, an online market place for selling books
moved to internet.
1995 eBay.com and Amazon.com were launched. Initially, eBay.com
was Auctionweb.
1997 Netflix was launched.
1998 PayPal, an online payment system was launched.
1999 Amazon launched 1-click service for faster purchase.
Alibaba.com was launched.
2000 Walmart launches its website with online shopping
2005 Amazon Prime Service was launched by Amazon which allows
users to expedite shipping on any purchase for a flat annual fee.
2007 Flipkart was launched.
AmazonFresh, online food ordering service was launched in
seattle.
2009 Bitcoin was launched.
2010 HBO Go was launched.
2011 Google wallet was launched.
2013 Google Express, online food ordering service was launched in
several cities of U.S., starting with San Francisco.
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China becomes largest E-commerce market in the world.

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 2014 Apple Pay was launched
2015 Pinterest enters the E-commerce market by adding buyable
pins.

2.2 Indian History of E-commerce

Year Event
1996 IndiaMart
Oct. 2007 Flipkart
2007 Myntra
2007 Infibeam
Aug. 2010 Paytm
July 2011 Shopclues
Sept 2011 Snapdeal
2012 Jabong
July 2013 Amazon.in
5th April 2015 PurchaseKaro.com
Oct. 2015 Abof.com (Aditya Birla Online Fashion)
May 2016 TataCliQ

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 3. PurchaseKaro.com

PurchaseKaro started by offering online shopping marketplace and today it offers

all major online services. We have our reach over 17 states of India. In a short span of
time PurchaseKaro has scaled to thousands of transaction per day. We strive to maintain
an open culture where everyone is a hands-on contributor and feels comfortable sharing
ideas and opinions. Our team spends hours designing each new feature and obsesses
about the smallest of details. Our approach is simple – to design something we’d Love to
use ourselves. Therefore we listen and take the time to understand our users and take
their reactions most seriously.

Making stuff easy and intuitive is not our only goal. In addition to usability, we strive
to create accessibility, convenience and credibility. Simplicity reflects in our home page
design and this mantra has been followed throughout the site and our apps.

The world is increasingly mobile: people want access from wherever they are,
whenever they need it. At PurchaseKaro, you have the option of recharging and shopping
from whenever, anywhere and are equipped with a secure online payment.

PurchaseKaro has some unique selling points also:

1. Confirmation call to the customer

2. Lowest commission rate in sector 8

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4. PurchaseKaro sellers’ life cycle

Inventory

Management
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 PurchaseKaro

Order

Processing

PurchaseKaro Sellers’ Life Cycle

Steps of PurchaseKaro Sellers’ life cycle

I. To be a seller, having a product is necessary. So, first step is to have a product.

II. Now, after a product, to sell on PurchaseKaro.com, one needs to sign up as sell.
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III. After signing up, he/she has to create a store by filling necessary information.
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Inventory Management
IV. After creating a store, seller has to list his/her products on portal.
V. After listing a product on portal, Product uploading team of PurchaseKaro.com
Analyse the product information, improves wherever it is necessary and
approves.
VI. After approval, product is uploaded on website. At this stage, products are visible
to visitors of websites.
Order Processing
VII. When a customer looks for a product on a website and finds it, he/she places an
order with submission of details like payment, delivery address, etc.
VIII. After placing an order, a customer gets a call from PurchaseKaro customer care
for confirmation of a product details and order details. So that, if there is any
mistake, it can be solved and product is not returned.
If an order is confirmed, a seller of that product is informed about order and told
to keep product deliver ready.
IX. After getting information about order, a seller has to do packaging of a product in
PurchaseKaro packaging material.
X. After packaging, logistic partner of PurchaseKaro picks up the product package
from the address of seller.
XI. After picking up the product, it delivers the product to delivery address.
XII. If customer has chosen COD (Cash On Delivery), Payment is received with
delivery. And Payment is done to PurchaseKaro account.
XIII. If a product is not returned within 7 days, sellers is paid on upcoming Thursday
through NEFT.

Now, let’s understand the cycle with an example:

Let’s assume Mr. X has mobiles of company Piones, and he wants

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to sell those mobiles on PurchaseKaro.com. So, we can say Mr. X has products,
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mobiles of Piones.

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 So, Mr. X goes on PurchaseKaro.com and clicks on sell on
PurchaseKaro as shown in below picture.

After clicking, sign up page opens. And, Mr. X has to register himself in a
window shown below.

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 After signing up, Mr. X has to fill up other details like pick up address, bank
account details, GST details, etc. and create a store.

After creating a store, Mr. X has to upload inventory (List products online). He
can upload product by mainly 2 ways: One to one upload and Bulk upload.

After uploading mobiles details on portal, it needs an approval from

PurchaseKaro team. So, product uploading team analyse the details uploaded by Mr. X.
If found necessary, product uploading team improvises details provided by Mr. X. At last,
approves Mobiles to be seen on website.

Now, product is visible on Mobiles category of PurchaseKaro.com

Mr. Y is willing to buy a mobile which is good in price and quality. So, he visits
PurchaseKaro.com, mobile category. And comes across this model of Piones Mobile. So,
he places an order for Piones Mobile.

Now, as order is received by PurchaseKaro. Customer care team calls Mr. Y

for confirmation of order. If Mr. Y has any doubt regarding Piones mobile, he could clear
those doubt, and then if He can make final decision if he wants to purchase it or not. If he
choose to purchase mobile, Mr. X is informed about order of Mr. Y

After being informed about of Mr. Y, Mr. X has pack the ordered mobile phone
with PurchaseKaro Packaging Material.

Then, Logistics Partner of PurchaseKaro picks up the package from Mr. X.

and delivers the mobile package to Mr. Y on Monday on 1st January, 2019.

If Mr. Y has chosen COD, Payment will be done and transferred to

PurchaseKaro account.

Now, PurchaseKaro has 7 days return policy. So, if a product is not returned
until Monday, 7th January, 2019. Payment for that mobile is transferred to Mr. X on
Thursday, 10th January, 2019. Because, according to PurchaseKaro Payment Policy,
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Payments to sellers are done on each Thursday.

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5. Inventory management at PurchaseKaro.com

Inventory Management at PurchaseKaro.com is mainly divided into 3 stages:

1) Getting Catalogue from sellers, 2) Uploading received catalogue and 3) keep tracking
stock of products on website

Inventory management is handled by Product uploading team.

5.1 Getting Catalogue from Seller

A good catalogue brings a good sales for a seller as well as platform

provider. So, Product uploading team looks for more and more product variety and
Range of products. So that, Sales of Sellers and PurchaseKaro increases. This
stage is optional. Because, some sellers upload their catalogue on their own.

5.2 Uploading received catalogue

In this stage, products are uploaded on portal. There are mainly 3 ways
of uploading products: 1) One to One upload, 2) Bulk Upload and 3) Search and
Sell

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 1) One to One upload:

When there is small number of products to be uploaded and each product

belongs to different category, this type of upload is generally used. Products like,
Mobiles, TV, etc. are uploaded by this method. In this method, first of all one has to
log in portal. After that, he has to click Add Product as shown below.

After Clicking add product, below screen opens, where details for the product has to be
uploaded.
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 After filling up all the details, clicking submit button uploads the product on
PurchaseKaro website.
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 2) Bulk Upload:

When there is large number of products to be uploaded and every

product belongs to same category, this type of upload is used. Products like,
Apparels, books, mobile covers, etc. are uploaded by this method. There are three
sub types for different kind of product: 1) Simple Bulk Upload, 2) Variation Bulk
upload and 3) Books upload. There are special format excel sheets for each
subtypes. An uploader has to fill details according to format. Then, he has to upload
CSV (Comma Separated Value) format excel sheet on portal.

Formats of all three type uploads are shown here:

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Variation Upload

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Simple Bulk Upload

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Book Upload

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 3) Search and Sell:
When a product is available on a website from any other seller, it is
unproductive to upload details for same product. So, instead of uploading details
again, product is searched on portal. And, then price and other concerned details
are needed to be filled. This option is currently disabled on portal.

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 6. Pricing of products

Selling Price on website consist of mainly 4 costs: Transfer price (Price of

Seller), Shipping cost, Commission and GST (Goods and Service Tax). Equation for
calculating Selling price is given below:

Transfer Price + Shipping cost + 0.18*Shipping Cost

Selling Price =
1 – (Commission/100) – (0.18*Commission/100)

Selling price = the price at which a customer buys a product.

Shipping Cost = Cost of delivering a product to the customer
Commission = Rate at which PurchaseKaro takes commission on Selling
Price.
Here, 18 % is GST rate on Shipping Cost and Commission.
Shipping Cost:
Shipping cost varies with the weight of the product.
Weight (in Grams) Shipping cost (Rs.) Weight (in Grams) Shipping Cost (Rs.)
500 48 5500 264
1000 96 6000 288
1500 144 6500 312
2000 192 7000 336
2500 240 7500 360
3000 288 8000 384
3500 336 8500 408
4000 384 9000 432
4500 432 9500 456
5000 480 10000 480
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Transfer Prices:
Transfer price is the price which seller wants after an order is completed. It
includes the cost of product and profit margin of seller. If the product is not returned
within 7 days, Seller is paid transfer price upcoming Thursday.
Commission Rate:
Commission rate is the rate at which PurchaseKaro charges on each product
order. Commission rate of PurchaseKaro is the lowest among top E-commerce
Company. Few examples of Comparison of commission rates is shown below:

Category Amazon Shopclues PurchaseKaro

Auto Accessories 17% 12% 10%
Clothing 17% 18% 10%
Fashion 23% 18% 12%
Accessories
Watches 13% 22% 8%

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7. Order Processing

Order processing at PurchaseKaro is mainly divided in 7 steps:

1) Customer purchase:
Customer visits the product page online and after looking at different
products, he/she selects a product and places an order for the same.
2) Confirm order & Have a call:
As order is received by PurchaseKaro, PurchaseKaro customer care
makes a call to customer for a confirmation regarding product. If customer has any
type of doubt regarding product, he/she can make it a clear and can confirm
his/her order. This feature is unique feature of PurchaseKaro.com. Lowest product
return ratio is the result of this feature.
3) PurchaseKaro Packing:
As PurchaseKaro customer care team confirms the order, seller is
informed about product order. So, seller has to pack the order with the help of
PurchaseKaro packaging material.
4) Pick up by logistics partner:
After the packaging, logistics partner of PurchaseKaro picks up the
packaged product from seller.
Logistics partners of PurchaseKaro.com are FedEx and Delhivery.
5) Product delivery:
After picking up the product from seller, logistics partner delivers the
product to the door of customer. If a customer has chosen CoD (Cash On
Delivery) as payment method, logistics partner takes the payment.
6) Payment to PurchaseKaro Account:
After delivery, payment is made to PurchaseKaro account.
7) Payment transfer to seller:
After 7 days of delivery, if a product is not returned, Transfer price for that
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product is transferred to Seller’s bank account on upcoming Thursday by NEFT

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 8. Research Methodology

8.1 Data Collection

The data for general statistics and all the information were collected
from reliable sources like, Company website, Company admin portal and
Office staff.
The communication method used for data collection was verbal
communication.

8.2 General Statistics

These are some general statistics of PurchaseKaro.com. These
statistics are as on 26th June, 2018.

 Total numbers of sellers live on website – 1300

 Total numbers of products live on website – 4,00,000
 Total numbers of orders placed per week – 500
 Total number of orders returned – 5%
 Total number of Blocked sellers - 17

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9. Key Findings

 While selecting an E-Commerce website, sellers look for number of orders per
week. After that, sellers look for sellers’ payment policy, Order return policy,
Number of returned / cancelled orders, Brand name & Value of E-Retailer, and
visitors of E-commerce website respectively.
 PurchaseKaro has lowest product return ration in E-Retailing Market.
 Marketing strategy is Digital Marketing (Social Media Marketing)
 Many of PurchaseKaro sellers doesn’t depend only on online sales.
 PurchaseKaro has lower commission rate compared to other big players of
industry.

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10. References

 https://en.wikipedia.org/wiki/Timeline_of_e-commerce
 https://www.statista.com/statistics/379167/e-commerce-share-of-retail-sales-in-
india/
 https://www.purchasekaro.com
 http://www.managementparadise.com/jasminepvk/documents/29212/influence-
of-trust-and-perceived-value-on-the-intention-to-purchase-travel-online/
 https://sloanreview.mit.edu/article/driving-operational-cost-savings-with-the-
internet-of-things/
 http://www.poms.org/journal/featured_articles/
 https://sloanreview.mit.edu/article/can-your-supply-chain-hear-me-now/
 https://uwaterloo.ca/systems-design-engineering/current-undergraduate-
students/courses/workshop-projects/fourth2000/e-commerce-strategy-
methodology-development-and
 https://sloanreview.mit.edu/article/winning-the-last-mile-of-ecommerce/
 https://selfstartr.com/types-of-ecommerce-business-models/
 https://sloanreview.mit.edu/article/unleashing-the-potential-of-supply-chain-
analytics/ 27
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