1. Amazon is an American e-commerce company founded in 1994 by Jeff Bezos and started online operations in 1995. Its mission is to be the most customer-centric company and build a platform for people to find and discover anything they want to buy online. 2. Amazon India faces many macroeconomic factors like inflation, interest rates, employment trends, competition, and government policies that can positively or negatively impact its business. High inflation reduces consumer spending power while low interest rates increase lending and consumer spending. 3. The Covid-19 pandemic led to high unemployment and inflation in India in 2020, negatively impacting consumer demand for Amazon's products and services. Increased competition from Indian e-commerce companies like Flipk

1. 2020
BIRLA INSITUTE OF MANAGEMENT AND
TECHNOLOGY
NAME:
YASHVARDHAN GEHLOT
SECTION - D
ROLL NO. - 20DM253
SUBMITTED TO:
Prof. Pooja Misra
Topic:
Amazon

2. About Company and its mission:
Amazon.in is America electronic commerce company deals with
buying and selling goods and service online.
Amazon headquarter – Seattle, Washington
Jeff Bezos is the founder of the company and he founded
company in 1994 and started operating it online from year 1995.
Mission
Company mission is to be in the list of the most customer-centric
company and to built a platform where people can come to find
and discover anything they wish buy online.
Glimpse of project
Amazon India has been initiating its scope and business at
various platforms and in much different scope as well. There are
many macroeconomic factors which mostly affect its working
either positively or negatively. Influencing natural as well as fiscal

3. events affecting the overall working of the company in the nation.
Inflation is the biggest example of such macroeconomic factors.
India is a developing country and keeping up with the pace of
development and growth of the country the company has to also
keep up its own growth. Dealing with the inflation rates of the
economy is the biggest challenge for the company and then
comes marketing conditions and opportunities. Parameter of
projects will be inflation, rates of interest, trends of employment in
India, competition, change in taxation, demonetization,
government policy, legal framework, political factor, technology.
INFLATION:
Due to Covid19, caused increase in inflation rate from 3.88%
(2019) to 4.25% (2020) and e-commerce businesses like Amazon
suffered a lot. Increasing inflation is affecting the demand of the
Amazon goods or services because it reduces the buying

4. capacity of the consumers which affected Amazon business.
Consumers actually restrict on their spending to only essential
items in time of high inflation. Inflation also increases the prices
of Electricity, Internet, advertising and electronic maintenance
and which results in the reduction of the profits.
Rate of interest:
Comparing to past years, interest rates has been declined and
this leads to the favorable point to the Amazon side because
low interest rates encourage borrowing. And low interest rates
in the country increases the e-commerce business because it
increases the quantity of cash in circulation in the economy
as results of the more lending and borrowing activities within

5. the economy. Consumers can spend more on Amazon
products once they have extra money at their disposal.
TRENDS OF EMPLOMENT:
Level of employment shows economic progress of the country.
Covid 19 resulted in the high unemployment rates which resulted
in the decline of the demand for Amazon products because few
people earn the income. Higher level of unemployment rates
creating worse condition of economy because no new jobs are
created and available in the market and more number of people
lost their jobs due to Covid19. As a result, the demand for
Amazon products declines with increased rates of unemployment.
Covid19 resulted in the job loss in the various industries because
lockdown has decreased the demand of various good and
services.

6. Competition:
NICHE STORE - Amazon sell almost everything but there are few
customers who will always prefer to buy it from the niche stores
and manufacturers. Amazon is doing great but still in terms of
knowledge and quality of local shops, they can’t compete with
smaller Indian niche shops that are experts in a particular industry
or product. Example - local vendors and small retailer shops.
Other e-commerce business like Flipkart:
Flipkart is an India based new company compared other
competitors of the Amazon and company is Indian-based online
selling platform which was founded in 2007 and currently Flipkart
has become the largest online retailer chain in the India.
Walmart acquired 77% shares of Flipkart in year 2018 which was
the biggest retail tie-up and valued the company at $22 billion.
Company like Walmart is controlling the majority portion of the
Flipkart, so there is great chance of success.
Flipkart is having more than 100 million user registered. The
platform’s very user-friendly in terms of design, mobile
application, and customer service which Flipkart providing to its
customer make it one of the up-coming Amazon competitors in
India. Such a wide range of products Flipkart offering, the
company is poised for great success in the future years.
Government policy

7. Draft Policy by Indian Government – Government of India was
working on the draft policy since long and the main agenda
behind imposing the draft policy is to keep transparency regarding
how company handling the customer data and for this purpose of
work, government appointed regulator to keep check on this.
Under this policy, e-commerce Company will require to make data
available to the government within 72hours and data include the
information related to the national security, taxation and law.
GST - Goods and service tax - As per the old tax system , there
was no uniform tax rates for the different states in India and
therefore every states was having different tax rates for the
different products and services. For example, an electronic item
in Rajasthan taxed VAT at 6% and in Delhi at 8%. Due to this, the
sellers of Delhi would not want to sell locally but would prefer to
sell from Rajasthan, which results in loss of revenue for Delhi. E-
commerce operators like Amazon have set up distribution centers
in certain locations and to collect VAT tax of product which they
sold. To compensate for the losses incurred by the seller incurred
from VAT so due to which many states recently imposed entry tax
on goods coming from one state to another, which resulted in
discourages sales made from one state to other states. This entry
tax was a barrier in the trade and also restricted the free
movement of goods from one state to another state and increases
the cost for traders and such trade barrier problem was solved
with the entry of uniform tax called GST. The following state earns
the revenue from GST on the sales made therefore no matter of
where the sale was actually made. And there is no rate arbitrage
in the GST just because the category of all the goods and rate of
GST is common for all the states in India.

8. Political factor
The political factor that affects the Amazon includes not only
limited to the political stability and instability but also attitude of
government towards Amazon business. Bhartiya Janta Party was
very supportive to the almost every new comer business and well
big settled business like Amazon. Bhartiya Janta Party came up
with the demonetization concept which created era of cashless
payment like UPI payment which resulted in the hike of the
prepaid orders.
Change in technology
Technology has had a major role in the ecommerce business in
India. Adaption of technology like artificial intelligence, cloud
computing, machine learning and chat bots made significant
improvement in this sector. Technology has created trust factor
amongst shoppers and sellers.
With technology improvement -
- Managing customer with Artificial intelligence
- Cashless payment
- Conversational marketing
- Company image search
Reliance Jio has made great contribution to the technology
improvement in the India. Before Jio, Indian data consumption

9. was very low but with Jio, consumption has been increased
tremendously and this resulted in availability of internet data at
cheap rates so more number people came to know about online
shopping and e-commerce.
Legal factor
Rising product regulation (opportunity)
- According product regulation, in India product like beef, liquor
and medicine can't be sold online but in other country Amazon
can sell these restricted products.
Changing FDI policy
FDI rules regarding the e-commerce business came into effect
from February 1, which restrict companies from trading of
products with firms in which they actually have equity interest and
also restrict them from making deals with sellers to sell
exclusively on their platforms and FDI was revised with a motto to
support small retailers.
Change in taxation:
As per the New Budget, the tax would be 1% on every sale made
by e-commerce platforms. Prime motto of government behind
charging tax of 1% on sales is to increase revenues from taxes to

10. balance weaker customer demand in the country which actually
slowed down the economy. But as per The Federation of Indian
Chambers of Commerce and Industry (FICCI) that this tax policy
will not help the e-commerce industry like Amazon and this will
result in the reduction in the trade of activity because if
government will charge more tax and Amazon will charge more
from seller overall this will increase in the price of products.
Demonetization:
Most of e-commerce giants welcomed and change their way to
deal this situation but Amazon has stopped accepting COD for
larger values orders on their sites because consumers who made
their orders on COD mode after the demonetization was asking
delivery boy to accept old notes or take back parcel and this had
added lot of loss to e-commerce and created huge problem for
Amazon.
Social factor:
Social behaviors affect the performance of Amazon negatively
and positively both. Amazon actually made youth lazy, allow them
to stay at home and do shopping rest Amazon delivery system will
take care about everything like online streaming of movies,
exclusive shopping and purchase of daily groceries online.
Amazon targeting social factor which involves emotions and India
customer segment is emotional towards culture and shopping so
Amazon always starts their sales during the time of Diwali by
offering great discount which results in the heavy profit to the
Amazon.

11. CONCLUSION:
Amazon is one of the favorite online buying and selling platform
to its customer, trade driven attitudes and modernized customer
online buying experience is the mission of the Amazon.
Recommendations
Amazon need to expand its service areas and create a new
incentive for its members and innovate with the goal of customer
retention.
Coming to the competition part, current political agenda is to
support Indian based company rather than international company
so Flipkart is big competitor of the Amazon so Amazon. in should
promote more number of small Indian manufacturers to gain more
Reference:
1. https://hbr.org/2016/07/how-amazon-adapted-its-business-
model-to-india
2. https://www.livemint.com/news/india/amazon-says-india-is-
where-the-biggest-covid-19-impact-on-its-business-is-
11588305474585.html

12. 3. https://m.economictimes.com/small-
biz/startups/newsbuzz/amazon-flipkart-operations-in-india-
being-disrupted-amid-lockdown/articleshow/74846491.cms
4. https://www.marketingtutor.net/pestle-analysis-of-amazon/
5. https://timesofindia.indiatimes.com/spotlight/amazon-smb-
impact-report-2020-over-10-lakh-small-and-medium-
businesses-across-india-continue-to-grow-with-
amazon/articleshow/80006574.cms