Global e-commerce giant Amazon just launched its new USD 20-or-less store "Haul" in the US to give Temu and Shein a run for their money. However, all eyes are on India, one of Amazon’s biggest markets with a massive demand for low-price retail.
With Temu’s absence and the central government’s ban on Chinese apps in 2020 that led to Shein’s exit, fast fashion and low-price retail are now dominated by popup stores from Uniqlo and Miniso, brand outlets like Zudio. Apart from Meesho, there is no significant market player in the online retail space for low-cost retail products.
If Amazon launches its low-price online store in India, it is expected to receive significant traction while taking over much of the market share. An India release will position it not only against the physical stores of Zudio, Miniso, and Uniqlo but also against their online stores, Meesho, and the upcoming Shein re-entry with Reliance.
Online-only platform in a Q-commerce climate
Amazon Haul is now an online-only platform in the US in its "beta" that offers free shipping in one to two weeks on orders over USD 25 (around Rs 2,100) and a delivery fee of USD 3.99 (about Rs 330) for orders below it. With the Q-commerce boom in India led by Zomato’s BlinkIt, Swiggy’s Instamart, and Zepto, the rates would be much lower for the Indian avatar of Haul.
Despite its unavailability in India, Temu and Alibaba enjoy a significant following in India through their international shipping. Shein had a loyal customer base, with fashion influencers and customers alike swearing by the brand on Indian social media till its ban in 2020.
Much like Amazon Pay—Amazon’s answer to Google Pay and other payment apps that use UPI—Haul is expected to be integrated into the Amazon app, much like its US release.
The current prices and delivery time on Amazon Haul align with those in Temu and Shein in the US, hinting that the products might also be outsourced from markets in China. However, Amazon offers an end-to-end guarantee with a 15-day return policy, subject to certain conditions.
Back in July, a report by The Economic Times suggested the re-entry of Chinese fast-fashion label Shein in the country after more than a year of signing the partnership deal with Reliance Retail Ventures. The partnership aimed to offer Shein products through Reliance Retail’s online channels and offline stores. However, this has yet to become a reality. As part of the escalating border tensions between India and China, the central government banned Shein in 2020, along with major social media platforms TikTok and more than 30 other apps.
Sustainability concerns mount with the growth of fast-fashion
The Indian retail market has seen an explosion of fast-fashion brands and low-cost retail stores—both in the online and offline space—over the past three to four years. This has also raised major concerns among sustainability experts as the products on offer have lower lifespans, make use of plastics and artificial fibres, and add to the increasing waste.
“Most of these products have not even been tested to see if they are good or not. And yet people buy and then have to throw it away because it often times ends up being low quality,” said Nayana Premnath, sustainability advocate.
These products are often returned due to quality concerns. In the US, sellers throw away a third of the returned products, said Premnath. “I wouldn’t be surprised if a large number of returned items have the same fate in India as well,” she added.
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Premnath, who received the 2022 Cosmopolitan award for “Sustainability Influencer of the Year, urged customers to reduce returns on such purchases if they cannot be avoided, while voicing her concern regarding Amazon’s potential launch of Haul.
“I’m honestly terrified if Amazon is trying to bring about such a model to India,” she chimed in. This would lead to a spike in unnecessary purchases, leading to a higher number of returned products and, ultimately, more waste. “With a lot of Indians still being ignorant when it comes to waste segregation, freecycling or selling for money, a large number of perfectly usable items will end up at the landfill,” said Premnath.
According to the latest reports, India manages a whopping 7,800 kilotonne of textile waste in a year. This is at least 8.5 per cent of the global textile waste, hinting at a much larger trend. More than 51 per cent of the waste in India is from post-consumer sources, such as discarded clothing and returned products allegedly dumped by sellers.