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Blog

The Ever-Evolving Government e-Marketplace (GeM): Opportunities and Challenges

Introduction

GeM is a dynamic, self-sustaining and one-stop e-Marketplace to facilitate on-line procurement of common use Goods & Services required by various Government Departments / Organizations / Public Sector Undertakings and other apex autonomous bodies of the Central Government.

Through the platform, the government aimed to create transparency, boost efficiency, and centralise the procurement process, while also enabling savings in the exchequer.

Public Procurement: Before and After

S.No	Category	Before GeM	After GeM
1	Process of Invitation of Bids	Manual process for invitation of bids, bid evaluation and finalisation of the winning bid	Completely online, no requirement for physical documentation
2	Public Procurement Policy	Multiple agencies with multiple procurement guidelines and procedures	Single, unified, fully online Public Procurement Portal with clear guidelines
3	Method of Procurement	Paper-based procurement procedure with physical interaction	Contactless, paperless and cashless with time-bound payments and real time monitoring
4	Method of Negotiation and Deliberation	Manual negotiation and fixing rates with the bidder and arriving at one rate applicable to all bidders	Automation and digitization of processes leading to higher process efficiencies, better information sharing & improved transparency
5	Process of Registration of Vendors	Registration of vendors was a manual process involving visit by officials to the vendor premises and was a difficult time-consuming process	Authentication of users is done through API integration with respective domain databases i.e., Aadhar, PAN, GSTN, MCA21 etc. There is no need for vendor to visit any office.
6	Barrier of Entry	Due to opaque rules formed by the procuring agencies there was high barriers of entry and cartelisation	Any entrepreneur can place bids directly to the government through a transparent process
7	Eligible Participants to the Bid	Limited bidding & only registered vendors could participate. Geographic coverage was limited to localized vendor base	Any vendor across the length and breadth of the platform can participate in the bid as long the product/service matches the bid
8	Monitoring of Product Delivered/ Service Provided	Huge delay in delivery of products/service from vendors side and delay in payment from buyers' side	Trust-based platform where there is real time monitoring to ensure on schedule delivery of products and service. Buyers are also mandated to make payments within ten calendar days after generation of receipt failing which fine will be levied

Key initiatives and opportunities

MSME SC/ST entrepreneurs on GeM

GeM is collaborating with various stakeholders from the Micro, Small and Medium Enterprises [MSME] ecosystem with special focus on entrepreneurs from the Scheduled Caste/ Schedule Tribes [SC/ ST]. The partnership is based on the objective of achieving the mandatory procurement goal of 25 percent from MSMEs and a sub target procurement of 4 percent goods and services from MSME entrepreneurs within SC/ ST communities, by all government departments and public sector enterprises [PSE]. This initiative seeks to encourage active participation of MSE sector in public procurement.

GeM has built a stellar seller base of over 27 lakh MSMEs and others, of which more than 7 lakhs are micro and small sellers in nearly five years.

Start-up Runway 2.0

Start-up Runway 2.0 is an opportunity for Start-ups to showcase their innovative products and services to Government buyers and engage in public procurement. GeM has created a dedicated marketplace category for all Start-ups to list their products and services, irrespective of their DPIIT-certification The platform offers Start-ups all the marketplace functionalities that are available to regular sellers and the objective is to spur "MAKE IN INDIA" procurement from India Start-ups. Till date, 3981 Start-ups have registered on GeM and have processed orders worth 689 Cr in Gross Merchandise Value.

Womaniya

"Womaniya" initiative seeks to showcase products made by women entrepreneurs and women self-help groups [WSHGs], and spur Women entrepreneurship by aligning them with opportunities to sell their products to various Government ministries, departments and institutions.

Womaniya aligns with Government's initiative of reserving 3 percent in public procurement from women MSME entrepreneurs and this offers immense potential for procurement.

Womaniya on GeM would boost hyper-local economic prospects for women entrepreneurs, while also addressing aims and objectives under the UN Sustainable Development Goal 5: Achieve Gender Equality to empower all women and girls.

The Saras Collection

The government introduced 'the Saras Collection 'programme to encourage and enable small artisans to sell their products on the GeM platform. Under the Deen Dayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM), the initiative showcased a flawless handcrafted collection of handicrafts, handloom fabrics, office décor, furnishings, accessories, event mementos, personal, hygiene, and care products from India's leading SHGs.

FY 21 Quarter 1 - Developments at a Glance:

GeM has onboarded more than 1.8 lakh self-help groups, artisans and weavers and close to 6.5 lakh MSME sellers. New Vendor Rating has been launched for both products and services. Product rating will have 2 new parameters of Buyer and User feedback and all new Service rating is introduced with 2 parameters - Quality and Buyer feedback.

To further ensure market sanity, "Out of Stock" products will also be displayed on the marketplace. A new filter is introduced for both buyers and sellers to include/exclude the out-of-stock products in their search results.

Users will now be able to search for seller details through Seller GeM ID. The feature is available on the homepage of the GeM website under "Seller Details".

In a unique and innovative way, GeM has introduced the listing of Green Air Conditioners on the marketplace. It will support more sustainable and eco-friendly procurement practices and will also help the buyers save financially.

The GeM Sahay app was launched to help sole proprietors attain frictionless uncollateralized working capital loans in real-time against orders on GeM at competitive rates.

Urgent and targeted measures were taken to fight against Covid-19. More than 2.3 lakh products were made available in the Medical and Auxiliary categories. Onboarding of oxygen cylinders and concentrators along with various other medical equipment has been undertaken in the marketplace. Real-time information on available categories and seller count is available on the website.

Issues and challenges

Every quarter, the GeM Quality Report (GQR) is published to provide the status of the overall health and quality of the platform on various parameters as defined in the GeM Quality Framework (GQF), which are Availability, Discoverability, Operability, Responsiveness, Delivery Quality and Product/Service Quality.

As per the GeM QUALITY REPORT, April – June 2021, improvement is required in the following parameters:

Availability of Online Platform- Average page loading time number is higher than the benchmark which means lower performance. Needs improvement.

Availability of Products & Services – New sub-categories added are lower than the benchmark. Needs improvement.

Discoverability (Catalog) - % of product uploads rejected number is higher than the benchmark which means lower performance. Needs improvement.

Operability (Registration) - Average time taken for registration of seller is higher than the benchmark which means lower performance. Needs improvement.

Operability (Order) - Average time taken for bid purchase and Cart abandonment rate is higher than the benchmark which means lower performance. Needs improvement.

Operability (Payments) - % of payments on-time number is lower than the benchmark. Needs improvement.

Payment Overdue - Overdue payment as a % of due payment is higher than the benchmark which means lower performance. Needs improvement.

Responsiveness of Customer Care - % of calls answered within 2 minutes is lower than the benchmark. Needs improvement.

Responsiveness (Training) -The number of GeM trainings conducted for capacity building across the nation is lower than the benchmark. Needs improvement.

Product/service quality - % of sub-categories with minimum 3 sellers is lower than the benchmark. Needs improvement.

Order acceptance rate and % of orders delivered on time is lower than the benchmark. Needs improvement.

INCIDENT MANAGEMENT (IM) Data reported in GeM Quality Report Between April and June 2021, over 40,032 incidents have been raised. 53.3% of incidents were related to catalogue (market) and 46.7% were related to post-contract. Incidents against catalogues were raised majorly as an activity to remove insane products. Among post-contract incidents raised, 38.5% were raised against buyers and 61.5% were raised against sellers. To further bring the post-contract incidents down, certain interventions were done in the IM process and a lot more are in progress to make the incident processing easier and faster for the users.

Conclusion

GeM is constantly evolving and adopting advanced technologies. GeM has immense potential and has achieved significant success so far. A concerted effort is required from all Government buyers, sellers and the various partners in the GeM ecosystem to make it a success and to allow it to unlock its full potential.

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