India's digital commerce landscape is expanding beyond traditional online marketplaces. Local retailers, independent brands, manufacturers, artisans, food businesses and small producers are exploring new ways to reach customers through digital channels. One initiative attracting attention is the Open Network for Digital Commerce (ONDC), an open network designed to connect buyers and sellers through compatible digital applications.

For a small business, the opportunity is worth understanding. A neighbourhood shop may have loyal local customers but limited online visibility. A handicraft maker may produce excellent products but struggle to reach buyers outside their district. A regional brand may want to expand without depending entirely on one marketplace. ONDC offers another route to explore, although success still depends on pricing, product quality, delivery, customer service and the seller's business economics.

This guide explains how ONDC works, who can explore it, how onboarding generally happens, what costs to examine and how Indian entrepreneurs can approach it strategically.

Important to understand: ONDC is not a single shopping app. It is an open network that enables compatible buyer and seller applications to interact. Your actual onboarding process, fees, product categories and available services depend on the participating seller application you choose.

What Is ONDC?

ONDC stands for Open Network for Digital Commerce. It is an initiative supported by the Department for Promotion of Industry and Internal Trade (DPIIT), under India's Ministry of Commerce and Industry. Its objective is to make digital commerce more open and interoperable rather than requiring all participants to operate within one closed platform.

In a conventional marketplace, sellers usually list products within that marketplace's own system. ONDC uses common protocols that allow compatible applications to communicate with one another. This can make participating sellers discoverable through different buyer applications, subject to network participation, category availability and applicable rules.

For example, imagine a small business selling locally made home décor. Instead of relying only on walk-in customers or its own website, the business may be able to list eligible products through a participating seller application. Customers using compatible buyer applications may then discover those products.

However, joining the network does not automatically guarantee orders, a particular ranking, nationwide delivery or lower total costs. Those outcomes depend on the seller's category, location, participating apps, logistics arrangements and commercial terms.

To understand the initiative directly, visit the official ONDC website.

Why ONDC Matters for Indian Small Businesses

India has millions of businesses that operate primarily offline. Many have useful products, established suppliers and local customer relationships but lack the resources to build sophisticated e-commerce operations independently.

ONDC may help eligible businesses explore digital commerce without having to develop every part of an online selling system themselves.

1. An additional route to online customers

Small businesses can investigate whether their products or services are supported by participating seller applications. If suitable, digital listing can provide another sales channel alongside a physical shop, social media, a website and other marketplaces.

2. Opportunities for regional products

Businesses selling handicrafts, clothing, home products, packaged goods and other eligible merchandise may be able to introduce their products to buyers beyond their immediate neighbourhood. Product eligibility and delivery coverage must be checked before onboarding.

3. Less dependence on a single sales channel

Relying on one source of customers can make a business vulnerable to changes in fees, policies, visibility or demand. Exploring several channels can improve resilience, provided each channel remains profitable and manageable.

This principle is closely related to effective customer retention strategies: sustainable growth requires both acquiring customers and creating reasons for them to buy again.

4. Access to supporting services

Seller applications and their partners may provide tools for catalogue creation, order management, payment processing, logistics and seller support. The exact services vary, so businesses should compare the actual offering rather than assume every provider delivers the same benefits.

Who Can Consider Selling Through ONDC?

ONDC is relevant to different types of businesses, but the availability of specific products and services depends on participating applications and applicable regulations.

  • Local retailers: Shops selling eligible groceries, household products, clothing or other retail merchandise.
  • Manufacturers: Businesses producing their own goods and seeking additional distribution channels.
  • Homegrown brands: Brands selling products such as apparel, accessories, décor or personal-care items, where supported.
  • Artisans and craft businesses: Producers of regional crafts, handmade goods and traditional products.
  • Food businesses: Eligible restaurants and food sellers using supported applications and holding the required registrations or licences.
  • Farmer groups and producer organisations: Eligible agricultural sellers exploring supported digital commerce routes.
  • Small and medium enterprises: Businesses seeking to test online demand for suitable products.

A business should not assume that every product category, pin code or service is available on every ONDC-connected application. Confirm eligibility, geographical coverage and operational requirements with the seller application before investing in onboarding or inventory.

How Does ONDC Work for a Seller?

Understanding the roles in the network makes the process easier to follow.

  1. The seller: The business that offers products or services and is responsible for accurate listings, stock, quality and fulfilment obligations.
  2. The seller network participant: The organisation or application that connects sellers to the network and may support catalogue digitisation, order management and related activities.
  3. The buyer application: The customer-facing application through which a buyer searches for products and places an order.
  4. Logistics and fulfilment partners: Where applicable, these partners help move orders from sellers to customers.
  5. Payment and support arrangements: Participating entities handle payments, settlements and customer or seller support according to their roles and agreements.

The customer may discover a product through a buyer application, while the seller operates through a different application. The open-network approach allows compatible systems to interact under the applicable protocols.

Read the official ONDC seller network participant information to understand how seller-side participants support onboarding and catalogue management.

How to Join ONDC as a Small Seller

For most small businesses, a practical starting point is to explore an existing seller application rather than attempt to build a network application independently. The following steps provide a useful general roadmap.

Step 1: Select the products you want to sell

Start with a manageable group of products. Choose items with reliable supply, clear demand, suitable packaging and enough margin to absorb delivery and selling expenses.

A shop selling hundreds of products does not necessarily need to digitise its entire inventory on the first day. Testing a small catalogue can help identify which products are easiest to manage and most commercially promising.

Step 2: Research participating seller applications

Visit the official ONDC website and examine the seller-side options available for your product category and location. Ask potential providers whether they currently support your category, whether onboarding is open, and what assistance they offer.

Compare at least two suitable providers when possible. Do not select one solely because an advertisement promises instant orders or guaranteed income.

Step 3: Prepare business documents

Requirements vary according to the provider, business structure, product category and applicable law. Commonly requested information may include:

  • PAN and identity or business verification documents.
  • Bank account details and supporting proof.
  • Business name, address and contact information.
  • GST registration details where legally applicable or required by the provider.
  • Product information, prices, images and inventory details.
  • Sector-specific licences or registrations where required.

Food sellers, for example, must check the applicable requirements of the Food Safety and Standards Authority of India. Other products may have additional labelling, safety, tax or regulatory obligations. Do not assume that joining a digital network replaces these requirements.

Step 4: Create your product catalogue

Prepare clear product names, accurate descriptions, high-quality photographs, available sizes or variants, stock quantities and final prices. Explain material, dimensions, ingredients or other relevant characteristics wherever appropriate.

Accurate catalogues help reduce customer confusion, cancellations, complaints and returns. Avoid exaggerated claims, misleading images and descriptions that promise features the product does not have.

Step 5: Understand the commercial terms

Before accepting the onboarding agreement, understand all applicable charges, settlement schedules, return rules, cancellation policies, logistics arrangements and support procedures.

Ask for the terms in writing. Find out how you can raise a complaint, correct a listing, pause a product or close your account if necessary.

Step 6: Test your operations

Once your products are live, confirm how orders appear, how inventory is updated, how dispatch deadlines work and how payments are reconciled. Keep a record of every order until you understand the complete workflow.

Use the digital payment reconciliation guide as a starting point for building reliable records of digital sales, settlements and transaction differences.

What Does It Cost to Sell Through ONDC?

There is no single universal cost that applies to every seller on the network. Costs depend on the participating application, business category, logistics model, order value and service agreement.

Potential expenses to investigate include:

  • Onboarding or account charges, if any.
  • Catalogue preparation, photography or digitisation.
  • Seller application fees or transaction-related charges.
  • Packaging and shipping.
  • Returns, refunds and failed deliveries.
  • Applicable taxes and statutory compliance.
  • Discounts, promotions and customer acquisition.
  • Staff time spent managing orders and customer queries.

Ask the provider for a complete written explanation of charges. Some services may be included in a package, while others may be billed separately. Never assume a service is free simply because the network is described as open.

How to Calculate Profit Before Listing Products

Sales revenue is not the same as profit. A product that sells quickly may still lose money if shipping, packaging, discounts and other costs consume its margin.

Consider this illustrative example for one product. These numbers are hypothetical and are not official ONDC fees.

Item Amount
Selling price₹800
Product cost₹420
Packaging₹30
Delivery expense paid by seller₹70
Application and transaction costs₹40
Other variable expenses₹20
Illustrative contribution before overheads and tax effects₹220

In this example, the contribution is ₹220 per order before fixed overheads and any additional tax effects not already accounted for. Actual profit may be lower after returns, damaged goods, unsold stock, staff time and other business expenses.

For a broader understanding of pricing and margins, use the BizNiche Studio business resources alongside your own order-level cost records.

How Can Sellers Improve Their Chances of Getting Orders?

Being listed is only the beginning. Sellers must create a reliable buying experience and monitor what customers respond to.

Choose products carefully

Prioritise products that are easy to describe, available consistently and practical to ship. Fragile, bulky or highly perishable items may require special packaging or logistics arrangements.

Use professional product photographs

Use bright, clear photographs that accurately represent the product. Include useful angles, scale references and images of important details. Do not use images that make the item appear different from what customers will receive.

Price for sustainable profitability

Compare the final customer price with the quality, market alternatives and delivery experience. Do not compete only by offering the lowest price. If discounts are necessary, calculate whether the resulting contribution remains positive.

Keep inventory accurate

Update stock promptly and avoid accepting orders for products that are unavailable. Stock errors can create cancellations and disappoint customers.

Deliver on time and communicate clearly

Pack orders securely, follow dispatch deadlines and respond to customer issues through the prescribed process. A seller who manages problems responsibly can protect customer confidence even when an occasional issue occurs.

Build a recognisable brand

Use consistent packaging, product information and customer communication. For more guidance, explore BizNiche Studio's article on building a strong business brand.

Can You Start an ONDC-Related Business Without Selling Products?

There may also be opportunities for entrepreneurs who help other businesses become digitally ready. However, supporting sellers is different from becoming an authorised network participant, and each activity has its own requirements.

Potential service ideas include:

  • Catalogue management: Helping retailers prepare accurate product descriptions, images, prices and stock records.
  • Product photography: Creating clean, consistent images for local manufacturers and shops.
  • Digital onboarding assistance: Helping businesses organise documents and understand application steps, without misrepresenting official affiliation.
  • Order operations support: Assisting with inventory updates, dispatch coordination and order records.
  • Packaging and fulfilment support: Helping sellers prepare orders for dispatch through suitable logistics arrangements.

Before offering such services, learn the relevant workflows and clearly state what you are authorised to do. Do not claim to be an official ONDC representative or guarantee onboarding or sales unless you have the appropriate authority and evidence.

Common Mistakes to Avoid

  • Expecting instant sales: Network access does not guarantee customer demand.
  • Ignoring the complete cost structure: Calculate product, packaging, delivery, platform-related and return costs.
  • Choosing a provider without comparison: Review support, charges, category coverage and contract terms.
  • Uploading poor-quality listings: Incomplete descriptions and inaccurate images can increase complaints.
  • Ignoring legal requirements: Verify GST, food safety, product labelling and other obligations relevant to your business.
  • Failing to reconcile payments: Match order values, deductions, refunds and bank credits regularly.
  • Scaling too early: Test a small catalogue and prove that the process works before committing significant money.
  • Trusting guaranteed-income claims: Be cautious of agents or advertisements promising assured orders, profits or special access in exchange for upfront payments.

A Practical 30-Day Plan to Explore ONDC

You can use the following plan to investigate the opportunity without rushing into large expenses.

  1. Days 1–5: Assess your business. Select products, estimate margins, review stock reliability and identify customer demand.
  2. Days 6–10: Research seller applications. Check the official participant information, category coverage, onboarding conditions and available support.
  3. Days 11–15: Prepare your catalogue. Organise product images, descriptions, prices, variants and inventory records.
  4. Days 16–20: Verify documents and costs. Confirm compliance obligations, settlement terms, return policies and all applicable charges.
  5. Days 21–25: Complete onboarding if suitable. Follow the selected provider's verified process and test the order-management workflow.
  6. Days 26–30: Review performance. Track orders, contribution per sale, delivery performance, cancellations and customer feedback. Decide what to improve before expanding.

This is a suggested planning framework, not a guaranteed onboarding timeline. Verification, approval and activation can take longer depending on the provider and business circumstances.

Official Resources to Check Before Joining

Programme details, eligibility criteria, available applications and commercial terms may change. Verify current information directly with official sources and the relevant service provider before paying fees or making business commitments.

Frequently Asked Questions

1. Is ONDC an app?

No. ONDC is an open digital commerce network, not a single shopping app. Buyers and sellers access the network through compatible applications operated by participating organisations.

2. Can a small shop sell through ONDC?

A small shop may be eligible if its products, business documents, location and operations meet the requirements of a participating seller application. Check the current criteria before starting.

3. Is joining ONDC free?

There is no universal answer for every seller. Onboarding, transaction, logistics, catalogue and other charges depend on the provider and agreement. Request a complete written fee breakdown before committing.

4. Do sellers need GST registration?

GST requirements depend on applicable tax law, the type of supply, the seller's circumstances and the platform's requirements. Check with the GST authorities or a qualified tax professional rather than assuming that every seller has identical obligations.

5. Does ONDC guarantee sales?

No. Access to the network does not guarantee orders or profit. Demand, competition, product quality, pricing, location, fulfilment and customer experience all influence results.

6. Can artisans and regional brands explore ONDC?

Yes, they can investigate suitable participating applications and supported categories. They should confirm product eligibility, onboarding requirements, packaging needs and delivery availability before proceeding.

7. How should a seller choose an onboarding provider?

Compare category coverage, written fees, support quality, settlement schedules, return policies, catalogue tools, logistics options and the procedure for resolving disputes. Check that the provider is genuinely participating in the relevant network role.

8. Is ONDC suitable for every business?

Not necessarily. It is worth considering when a business has products suited to online selling, dependable stock, workable margins and the ability to fulfil orders. Some businesses may find a local website, direct selling or another channel more appropriate.

Final Thoughts

ONDC offers Indian businesses another way to explore digital commerce through an interoperable network of participating applications. For local retailers, manufacturers, artisans and homegrown brands, the opportunity is not simply about getting listed online. It is about building a dependable digital sales process that customers trust and the business can afford to operate.

Start by checking eligibility, comparing seller applications, preparing accurate product listings and calculating your real costs. Test the process with a manageable catalogue, measure the results and expand only when the numbers support it. A careful, data-driven approach is more valuable than chasing online trends without a clear business plan.