India’s ONDC Revolution: How Small Businesses, Farmers and Local Brands Can Sell Online
Imagine a small shopkeeper in Kashmir, a handicraft maker in Srinagar, a farmer in Gujarat, or a regional food brand in a small Indian town. Each has products that customers may want, but reaching buyers beyond the local market can be difficult and expensive.
This is where the Open Network for Digital Commerce, commonly known as ONDC, becomes interesting. It aims to make digital commerce more accessible by connecting different buyer applications, seller applications, merchants, and service providers through an open network.
Rather than requiring every business to build its own expensive online marketplace, the network creates a shared digital infrastructure through which participating businesses can connect with customers using compatible applications.
For India's small businesses, farmers, manufacturers, local retailers, and emerging brands, this model creates new possibilities. However, joining a digital network is not a guarantee of sales or profit. Businesses still need the right products, pricing, service quality, and marketing strategy.
What You Will Learn
- What ONDC is and why it matters to Indian businesses.
- How the open digital commerce network works.
- How small retailers, farmers, and local brands can benefit.
- What types of businesses can explore the opportunity.
- How onboarding, logistics, and digital catalogues fit together.
- What costs, risks, and practical steps entrepreneurs should consider.
1. What Is ONDC?
ONDC stands for Open Network for Digital Commerce. It is an initiative associated with the Government of India's Department for Promotion of Industry and Internal Trade (DPIIT).
Its main idea is to make digital commerce more open and interoperable. In simple words, different businesses and applications can connect through a common network instead of operating entirely within separate, closed systems.
Think about how communication works. People using different email services can communicate with one another because the systems follow compatible standards. ONDC applies a related idea to digital commerce, allowing participating applications to discover and transact with sellers across the network, subject to its technical requirements and rules.
ONDC is not itself a single shopping application. Customers use participating buyer applications, while sellers generally connect through participating seller applications or network service providers.
You can learn more through the official ONDC website.
2. How Does ONDC Work?
The network involves several participants. Understanding their roles helps entrepreneurs identify where their own business fits.
Buyer application
Provides the customer-facing experience for discovering products and placing orders.
Seller application
Helps sellers list products, manage catalogue information, receive orders, and participate in the network.
Logistics partner
Supports the movement of products from sellers to customers where delivery services are available.
Technology provider
Helps businesses integrate with the network and manage technical or operational requirements.
Consider a local business selling packaged Kashmiri products. It can explore working with an eligible seller-side network participant to digitise its catalogue and make its products available through connected buyer applications.
A customer browsing a participating application may discover the products, check the available information, place an order, and receive order updates. The participating businesses and service providers handle their respective responsibilities under the network's rules.
This structure separates different parts of the digital commerce process. A seller does not necessarily have to develop its own customer-facing shopping app simply to participate.
For the official explanation, read how shopping through ONDC works and the information about seller network participants.
3. Why Is ONDC Important for Indian Small Businesses?
India's business landscape includes millions of neighbourhood retailers, small manufacturers, artisans, food producers, and independent sellers. Many have valuable products but limited access to digital distribution.
An additional route to online customers
A small retailer may already have a physical shop and a loyal customer base but lack the resources to build a complete e-commerce platform. Participating in a suitable seller network can provide another route to digital discovery and orders.
It does not eliminate the need for good service or promotion, but it may reduce some of the technical barriers associated with entering online commerce.
More options for regional brands
Regional brands often understand their local customers well but struggle to expand beyond familiar markets. Digital catalogues can help them present their products to a broader audience where relevant buyer applications, fulfilment services, and customer demand are available.
For example, a business selling traditional food products may be able to reach customers outside its immediate area if the product category, delivery arrangements, packaging, and applicable regulations support it.
Opportunities for neighbourhood retailers
Kirana stores and independent retailers can investigate whether participating seller applications support their product categories and locations. Digital participation may complement their existing business rather than requiring them to abandon physical retail.
Potential access to shared infrastructure
Businesses may be able to use participating service providers for catalogue management, integration, payments, and logistics rather than building every capability independently.
The actual services, costs, and benefits depend on the selected provider and the terms of participation. Sellers should compare these carefully before signing up.
4. A Real-World Example: Helping Farmers Reach Digital Customers
One particularly interesting opportunity is the digitisation of agricultural products and farmer-owned businesses.
In October 2026, Financial Express reported on India Post's delivery of more than 60,000 parcels from Farmer Producer Organisations in Gujarat through a pilot connected with ONDC and the MyStore application.
The report described participating farmer organisations selling products including pulses, cumin, groundnuts, snacks, and millet cookies. India Post provided logistical support, helping participating organisations reach customers through an additional digital sales channel.
This example illustrates an important business principle: digital commerce requires more than an online listing. Producers also need suitable packaging, inventory, order handling, delivery arrangements, and a reliable way to serve customers.
For a Farmer Producer Organisation (FPO), an online channel may help test demand beyond its traditional local market. For a regional food entrepreneur, it highlights the importance of combining product quality with dependable fulfilment.
Similar opportunities may exist for handicrafts, packaged regional foods, textiles, and other products, depending on category availability, seller eligibility, logistics, and customer demand.
5. Business Opportunities Entrepreneurs Can Explore
ONDC creates opportunities not only for people who sell products but also for businesses that help sellers participate in digital commerce.
Opportunity 1: Regional product brands
Entrepreneurs can develop packaged foods, handicrafts, home products, textiles, and other regionally distinctive goods. Success depends on consistent quality, attractive packaging, suitable pricing, and reliable fulfilment.
Opportunity 2: Seller onboarding services
Small businesses may need help preparing product information, organising photographs, creating digital catalogues, understanding seller requirements, and managing online orders. A service provider can offer these services where permitted and supported by a participating network partner.
Opportunity 3: Packaging and product presentation
Sellers need packaging that protects products during transportation and presents the brand professionally. Businesses can supply packaging materials, labels, product photography, and catalogue design services.
Opportunity 4: Local logistics and fulfilment
Eligible logistics businesses can explore partnerships that support pickup, delivery, and fulfilment. Entrepreneurs should first verify network requirements, delivery demand, service-area coverage, insurance, and operating costs.
Opportunity 5: Technology and catalogue management
Developers and digital agencies can help sellers manage product data, stock information, order workflows, integrations, and reporting. These services can be useful to merchants who want digital reach but do not have an in-house technology team.
Opportunity 6: Digital marketing for sellers
Businesses still need to communicate product benefits, build trust, and encourage repeat purchases. Marketing professionals can help with product descriptions, brand identity, customer communication, social media, and campaign measurement.
Explore our related guide to WhatsApp Business marketing for Indian small businesses for practical ideas on building customer relationships.
6. How Can a Small Business Start Selling Through ONDC?
Businesses should approach onboarding as a commercial decision, not simply as a technology project. The following steps provide a practical starting point.
Step 1: Choose the right products
Identify products with consistent quality, reliable supply, competitive pricing, and sufficient margin to cover packaging, fulfilment, commissions or service fees, returns, and other expenses.
Start with a manageable product range instead of listing everything at once.
Step 2: Prepare your business information
Organise accurate product names, descriptions, prices, photographs, available quantities, dimensions or weights where relevant, and delivery information.
Keep business registration, tax information, licences, and other documents ready as applicable to your business and product category. Requirements vary by activity.
Step 3: Find a suitable seller network participant
Visit the official ONDC website and review the available seller resources. Identify participating seller applications or service providers that support your category and location.
Ask about onboarding charges, commissions, settlement schedules, catalogue management, customer complaints, returns, delivery coverage, and ongoing service fees.
Step 4: Calculate your actual profit
Suppose you sell a product for ₹500 and the product itself costs ₹300. Your initial gross margin is ₹200 before other expenses.
If packaging costs ₹20, fulfilment costs ₹50, and the seller-side service charges and other variable expenses total ₹60, the amount remaining is ₹70 before fixed expenses and tax.
These figures are hypothetical. Actual costs vary by category, provider, order, and commercial arrangement.
The example shows why sellers should calculate the contribution from each order instead of assuming that a higher online selling price automatically means higher profit.
Step 5: Test demand before expanding
Begin with a manageable product range and monitor orders, customer feedback, cancellations, returns, delivery performance, and net contribution.
Expand the catalogue or increase production only when there is evidence of demand and sufficient working capital to support growth.
For more guidance, read our articles on turning skills into scalable business offerings and improving brand visibility in digital discovery systems.
7. Does ONDC Guarantee More Sales?
No. Participation in an open network can create an additional route to digital discovery, but it does not guarantee customer demand, high rankings, or profitability.
Sellers still compete on product quality, price, availability, customer experience, and fulfilment. Their products must also be visible and accessible through relevant buyer applications.
Businesses should avoid assuming that joining ONDC automatically provides the same marketing, customer reach, or operational support in every location and category.
Before onboarding, ask the service provider how products become discoverable, whether paid promotions are available, what data and reporting the seller receives, and how customer complaints are handled.
8. Challenges Small Businesses Should Understand
Competition and pricing pressure
More online visibility can also expose sellers to competition from other businesses. If several sellers offer similar products, a business may face pressure to lower prices.
Sellers should compete through quality, differentiation, customer service, and sound cost management rather than relying only on discounts.
Delivery and returns
Products must reach customers in acceptable condition and within the stated delivery terms. Damaged goods, delays, incorrect orders, and returns can reduce margins and harm a brand's reputation.
Cash flow and settlement
Businesses need working capital to purchase stock, pay suppliers, prepare orders, and manage operating expenses. Understand settlement timelines and dispute procedures before committing to large inventories.
Compliance and product quality
Sellers must comply with the laws and requirements relevant to their products. Depending on the category, these may include food safety rules, labelling standards, consumer protection obligations, tax requirements, and other licences.
Do not assume that digital onboarding replaces the need to meet applicable legal and quality requirements.
Dependence on service providers
A seller may depend on a third party for catalogue management, integration, logistics, or support. Review the contract, pricing, data access, service levels, and exit arrangements before entering a long-term relationship.
9. What ONDC Could Mean for Businesses in Jammu and Kashmir
Jammu and Kashmir has products and businesses that may be well suited to exploring digital distribution, including handicrafts, textiles, regional foods, and other locally produced goods.
For a small producer in Kashmir, reaching customers outside the region can be challenging because of marketing expenses, packaging requirements, shipping arrangements, and limited access to large retail networks.
A suitable digital commerce channel may help a seller test demand in other markets without immediately opening a physical store elsewhere. However, actual participation depends on product eligibility, available seller services, fulfilment coverage, and commercial viability.
For example, a business selling packaged regional food products could begin by identifying its best-selling items, improving product photography, calculating shipping and packaging costs, and checking which seller applications support the relevant category.
A handicraft business could prepare accurate descriptions, dimensions, materials, care instructions, and photographs that communicate the value of each product.
Local entrepreneurs can also explore services that help other businesses digitise catalogues, improve product presentation, and manage online orders.
The opportunity is not limited to selling products. It also includes helping local businesses become digitally ready.
10. The Future of Open Digital Commerce in India
India's digital commerce ecosystem is evolving through technology, logistics, digital payments, and new ways of connecting sellers with buyers.
Open-network models may create new options for independent businesses, but their long-term success depends on reliable operations, customer trust, useful applications, and sustainable commercial arrangements.
For small businesses, the smartest strategy is to treat ONDC as one potential sales channel within a wider business plan. A seller can combine digital network participation with a physical shop, direct customer relationships, social media, its own website, and other suitable marketplaces.
Diversifying sales channels can reduce dependence on a single source of customers, although every channel brings its own costs and operational requirements.
Final Thoughts
ONDC represents an important experiment in making digital commerce more open and accessible. It offers Indian entrepreneurs another way to explore online sales, discover new customers, and connect with service providers.
For retailers, farmers, regional brands, and small manufacturers, the first step is not to invest heavily in technology. It is to understand the network, select suitable products, find a reliable onboarding partner, and calculate whether online orders can generate sustainable returns.
Digital access creates possibilities, but strong businesses are built through good products, honest marketing, reliable fulfilment, customer trust, and disciplined financial management.
Frequently Asked Questions
1. What is ONDC in simple words?
ONDC is an open digital commerce network that connects participating buyer applications, seller applications, and other service providers. It aims to make digital commerce more interoperable rather than keeping every participant inside one closed platform.
2. Is ONDC a shopping app?
No. ONDC is the network connecting participating applications. Customers shop through buyer applications that support the relevant products and services.
3. Can a small shopkeeper sell through ONDC?
A small shopkeeper can explore participation through an eligible seller application or network service provider. Availability, onboarding requirements, costs, and supported product categories depend on the provider and location.
4. Does ONDC charge sellers a fixed commission?
There is no single universal fee that should be assumed for every seller and arrangement. Sellers should check the current commercial terms, including commissions, service fees, logistics charges, and other applicable costs.
5. Can farmers sell products through ONDC?
Farmer Producer Organisations and eligible agricultural or food businesses can explore suitable network arrangements. They must assess category availability, product requirements, packaging, logistics, and relevant regulatory obligations.
6. Does joining ONDC guarantee orders?
No. Participation provides a potential digital sales channel, not guaranteed demand. Product quality, pricing, visibility, customer experience, and reliable fulfilment remain important.
7. How can I start?
Begin with the official ONDC website, review its seller information, identify an appropriate participating seller application or service provider, compare commercial terms, and prepare your product catalogue and business documents.
Official Resources and Further Reading
- ONDC official website — network overview and participation information.
- Seller network participants — understand how seller-side participation works.
- How to shop through ONDC — understand the buyer experience.
- Financial Express report on India Post and FPO deliveries — an example of digital commerce and logistics supporting agricultural organisations.
Editorial note: Network features, participant availability, and commercial terms can change. Verify current requirements with ONDC and the relevant service provider before making business or investment decisions.
