For retailers, ecom highs come with headaches

Kolkata retailers face mounting challenges as they battle it out with e-commerce giants Amazon and Flipkart, even as they strive to maintain their brick-and-mortar stores. Indian retailers are discovering the costly nature of online competition, as evidenced by Tata-owned chain Trent's 35% year-on-year surge in consumer complaints, rising to over 300,000 in FY26. Similar increases were reported by V-Mart Retail and Titan, with complaints crossing the 130,000 mark each.

While customer complaints may be a solvable issue, the more pressing challenge is determining when to abandon markets that prove unprofitable despite the relentless pursuit of online order volumes. Avenue Supermarts, a leading grocery retailer, has trimmed its online venture DMart Ready from 24 markets to just 11 in a bid to achieve a sustainable, profitable ecommerce model.

The company's MD, Anshul Asawa, explained that its initial expansion into newer markets brought a large customer base but also a significant rise in losses.

Reliance Retail, another prominent player, is adopting a more cautious approach, doubling down on quick commerce and digital retail while scaling back operations where profitability assumptions fall short. The company's CFO, Dinesh Taluja, emphasized that they will go in a disciplined manner, avoiding the temptation to chase volume growth or unattainable metrics.

Infiniti Retail, Tata's electronics retailer Croma, has aligned prices across both its physical stores and online channels, after finding that 70-80% of consumers research prices online before visiting a store. This shift in strategy comes after aggressive online promotions proved ineffective in driving sales. Despite heavy investments in ecommerce, Indian retailers have found that their online sales share of total sales has stagnated, growing by only 1-2 percentage points over the past few years.

However, retailers continue to pour money into digital initiatives. Avenue Supermarts, despite a surge in net losses, approved a fresh investment of up to ₹500 crore in its online grocery business.