Meesho charges zero commission from sellers on their sales but charges for services like advertisement, logistics and other business tools that it provides to merchants
New Delhi: With the government relaxing GST rules for online sellers, Softbank-backed Meesho aims to add 1 crore merchants on its platform by 2027, a top official of the company said on Tuesday.
Meesho is the first e-commerce company in India to turn profitable at the group level (consolidated profit) and expects the momentum to continue, Meesho CEO Vidit Aatrey claimed.
“We have 1.3 million (13 lakh) sellers on our platform. The recent change in policy to allow more sellers without GST is a big boost. We are now planning to add 1 crore more sellers across the country by 2027,” Aatrey told PTI.
He said that e-commerce is still at a very nascent stage and there are only 1.5-2 million merchants that sell online.
“Internet penetration, network reliability, and online payments are increasing and people are buying online in a big way. We will continue with our outreach and do whatever is required to onboard sellers. These are the factors that will drive growth in the merchant base,” Meesho said.
Meesho charges zero commission from sellers on their sales but charges for services like advertisement, logistics and other business tools that it provides to merchants.
“We have become more efficient as an organisation. We are very selective on the categories that are profitable,” Aatrey said.
Meesho posted operational profit in the June quarter but it turned profitable at the group level in July. The company has not disclosed the actual number but according to Aatrey, it was less than Rs 10 crore.
“Only 5-6 per cent of retail transactions are happening online. India has the potential to do a lot more than this,” Aatrey said.
He said that the current macroeconomic situation of inflationary pressure has helped Meesho.
“We have removed middlemen. We are seeing buyers are able to do more on our platform with the same budget they have had. In such a scenario, people tend to gravitate towards more value for money. That is only going to help us,” Aatrey said.
He said that the company has seen growth in the number of orders especially from non-metros.
“43 per cent surge in order volumes and 54 per cent increase in revenue in the last 12 months contributed to the profitability of the company, ” Aatrey said. He said that the company will stick to its principles and not start charging commissions from merchants on the sale of their products.
