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How to Sell on Zepto in 2025: A Comprehensive Guide

Harsh Vaidya

Written By
Harsh Vaidya

Published on January 10, 2025

Last updated on January 13, 2025 • 4 min read

Zepto has emerged as one of India’s leading instant delivery platforms, connecting sellers with millions of customers seeking groceries, essentials, and more. If you’re a business owner looking to list your products on Zepto in 2025, This guide will take you through how to sell on Zepto, covering the registration and selling process step-by-step..

Table Of Contents
  1. Why Sell on Zepto?
  2. How to Sell on Zepto in 2025 : Step-by-Step Guide
  3. Tips for Success on Zepto
  4. Accelerate Your Quick Commerce Sales with WareIQ Fulfillment
  5. Conclusion

Why Sell on Zepto?

  1. Rapid Delivery Network: Reach customers in under 10 minutes with Zepto’s robust infrastructure.
  2. Expanding Customer Base: Tap into a growing market of customers preferring online purchases for daily essentials.
  3. Seamless Seller Tools: Access a suite of tools to manage inventory, orders, and payments efficiently.
  4. Focused on Essentials: Perfect for sellers of groceries, personal care, and household products.

How to Sell on Zepto in 2025 : Step-by-Step Guide

1. Prepare the Necessary Documents

Before registering on Zepto, ensure you have the following:

  • Business Details:
    • GSTIN (mandatory for most categories).
    • PAN card (individual or business).
    • Bank account details with a canceled cheque.
  • Product Details:
    • High-quality images and accurate descriptions of the products you intend to sell.
  • FSSAI License:
    • Mandatory if you plan to sell food items.

2. Sign Up as a Seller

To register on Zepto, follow these steps:

  1. Visit the Zepto Partner Registration Page.
Zepto Partner registration page
  1. Click on “Get Started” to begin your application.
  2. Provide your business name, contact details, and product categories.
  3. Upload the required documents for verification.

3. Set Up Your Seller Dashboard

Once your account is approved:

  1. Add Product Listings:
    • Upload product images, descriptions, and pricing.
    • Ensure compliance with Zepto’s quality guidelines for listings.
  2. Set Inventory Levels:
    • Keep your inventory updated to avoid cancellations or stock-outs.
  3. Choose Fulfillment Preferences:
    • Zepto’s instant delivery network relies on local fulfillment centers or direct seller delivery.

4. Verification and Activation

Zepto’s team will:

  • Verify Documents: Ensure all provided details are accurate and meet their criteria.
  • Conduct Onboarding Training: Familiarize you with Zepto’s seller policies and tools.
  • Activate Your Account: Once verified, your store will go live on the platform.

5. Start Selling

With your account live:

  • Monitor orders via the Zepto Seller Dashboard.
  • Manage inventory to meet high-demand periods.
  • Use Zepto’s insights to optimize product offerings and pricing.

Tips for Success on Zepto

  1. Leverage Hyperlocal Data: Use data-driven insights to position inventory close to demand hubs for instant availability.
  2. Maintain Quality Standards: High-quality products and reliable packaging enhance customer satisfaction and reduce returns.
  3. Competitive Pricing: Monitor market trends to offer attractive pricing and deals that encourage repeat purchases.
  4. Participate in Campaigns: Use Zepto’s promotional tools to boost visibility during key sales periods.

Related read: Swiggy Instamart Vs. Zepto: A Comparative Analysis of Quick Commerce Giants

Accelerate Your Quick Commerce Sales with WareIQ Fulfillment

Regionally place your inventory to fulfill purchase orders from Zepto, Blinkit, and Swiggy Instamart with a fully compliant solution. Drive frequent replenishments to multiple dark stores, on schedule and with Proof of Delivery.

How Does It Work?

  • Step 1: Place Your Stock in Regional FCs to Avoid Lost Sales
    • WareIQ operates fulfillment centers in 15 cities across India.
    • Our planning engine assists in making the right inventory placement decisions in the right city.
  • Step 2: On Receiving Purchase Orders, WareIQ Picks, Packs & Dispatches
    • Stock batch management to avoid rejections.
    • Process compliant with Zepto, Blinkit, and Instamart requirements.
    • Repackaging at scale and scan-based operations to minimize errors.
  • Step 3: Deliver On-Time Based on Appointments, with PODs
    • Multiple delivery options integrated for consignments—B2C couriers, daily milk-runs, PTL, etc.
    • Proof of Delivery (POD) with all shipments to avoid conflicts.

Key Features of WareIQ’s Quick Commerce Fulfillment:

  • Flash Storage: Short-term storage tailored for quick commerce.
  • Deliveries Within 48 Hours: Appointment-based deliveries using diverse courier options.
  • Pan-India Network: Fulfill 20-50 dark stores per city daily with our scalable network.
  • Smart Inventory Placement: AI-led distribution to reduce costs and capture lost sales opportunities.
  • Packaging, Labeling & Repacking: Compliant with Zepto, Blinkit, and Swiggy Instamart standards.
  • ERP/WMS/OMS Integrations: Connect seamlessly with the system of your choice.
  • Proof of Delivery Access: Avoid conflicts with POD across couriers.
  • Dedicated Customer Support: Ensure no purchase order fulfillment is missed.

Partner with WareIQ to streamline your quick commerce fulfillment needs and achieve operational excellence for platforms like Zepto, Blinkit, and Swiggy Instamart.

Suggested read: Top 11 Quick Commerce Companies in India

Conclusion

Selling on Zepto in 2025 offers immense opportunities for businesses to cater to a fast-growing customer base seeking speed and convenience. By following this guide, you can establish a robust presence on Zepto’s dynamic platform.

With WareIQ as your logistics partner, you’ll not only simplify your operations but also gain a competitive edge in the quick commerce space. Start today and make the most of Zepto’s growing ecosystem with WareIQ by your side!

You may also like to read: How to Sell on Blinkit in 2025

Supercharge your fulfilment with WareIQ now, contact our team.

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Harsh Vaidya
Author

Harsh Vaidya

Harsh Vaidya is the Founder & CEO of WareIQ - a Y-Combinator-backed full-stack fulfillment solution catering to the fulfillment & shipping needs of 400+ eCommerce brands across categories. He was previously the Chief of Staff at Pitney Bowes managing Corp Dev & Strategy for $2.4 B SMB BU. He has 10+ experience in Strategy Consulting & SMB tech.

Read all of Harsh Vaidya's Posts

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Flipkart’s Regional Inventory Shift: What Sellers Need to Know [2025]

Flipkart’s Regional Inventory Shift: What Sellers Need to Know [2025]

In recent years, Flipkart's Regional Inventory Shift has emerged as a critical strategy to enhance supply chain efficiency, especially as the festive season draws near. With millions of sellers leveraging Flipkart’s marketplace, the need for effective inventory management is more important than ever.As we enter a highly competitive period with significant sales events like Big Billion Days and other festive sales, understanding this shift and its implications is essential for sellers to optimise their operations. In this article, we’ll explore Flipkart's Regional Inventory Shift, why it's crucial for sellers, and how it impacts operations, logistics, and customer experience during the festive season. What is Flipkart's Regional Inventory Shift? Flipkart's Regional Inventory Shift refers to the e-commerce giant's strategy of decentralising inventory across various regional warehouses rather than keeping it at a single, central location. The shift allows Flipkart to place inventory closer to key consumer markets, reducing delivery times and costs. By adopting this strategy, Flipkart aims to: Enhance supply chain flexibility Improve delivery speed Reduce operational costs In this process, products are stored in multiple regional hubs to cater more effectively to the demands of customers in different locations. This model aligns with the growing consumer expectation for fast, cost-effective deliveries, especially during high-demand periods like the festive season. Why is Regional Inventory Important for Sellers? For sellers on Flipkart, understanding and adapting to Flipkart's Regional Inventory Shift is essential for improving their sales and ensuring smooth operations. Here’s why: 1. Faster Delivery Times By decentralising inventory, Flipkart reduces the time it takes for customers to receive their orders. Sellers who take advantage of this system can ensure their products are closer to their buyers, significantly improving delivery speed. Quick deliveries are particularly crucial during the festive season when demand spikes. 2. Lower Shipping Costs Shipping costs can often be a major concern for sellers, especially when dealing with long-distance deliveries. With products stored closer to end consumers, the Regional Inventory Shift reduces the distance goods must travel, resulting in lower shipping costs. This also minimises the chances of delayed deliveries due to logistical challenges, a key factor during high-demand periods. 3. Better Demand Forecasting Regional inventory systems provide real-time data on which products are most in demand in specific regions. Sellers can use this information to better manage their stock levels, reducing the risk of overstocking or understocking products during the festive season. By having a more accurate sense of regional demand, sellers can plan their inventory more efficiently. 4. Increased Customer Satisfaction Consumers expect quicker and more reliable deliveries, especially during festive seasons. By utilising Flipkart's Regional Inventory Shift, sellers can offer a better customer experience, which can lead to higher ratings, repeat business, and positive reviews. How Does Flipkart's Regional Inventory Shift Work? Flipkart has invested significantly in its supply chain infrastructure to implement regional inventory management as India's e-commerce sector is projected to reach $150 billion by 2026, up from a $57–$60 billion valuation in 2023. Here’s how the process works: 1. Stock Allocation to Regional Hubs When sellers list their products on Flipkart, they are allocated to one of Flipkart's regional warehouses based on historical demand data and regional preferences. Sellers who use Flipkart’s fulfilment services can take advantage of this allocation, ensuring that their products are stored closer to the areas where they are likely to sell the most. 2. Dynamic Reallocation Based on Demand As the demand for products fluctuates, Flipkart uses predictive analytics to dynamically adjust the stock levels at different regional hubs. For example, if there’s an unexpected surge in demand for a product in a particular region, Flipkart can quickly reallocate inventory to meet the increased need, ensuring there is no stockout. 3. Enhanced Delivery Mechanisms Once an order is placed, the product is dispatched from the nearest regional warehouse, which reduces the time taken to reach the customer. In addition, Flipkart leverages its extensive network of delivery partners and its last-mile delivery infrastructure to ensure fast and efficient delivery. Also read: Flipkart Video Management System (VMS) for Sellers Impact on Sellers During the Festive Season The festive season is one of the most critical times for e-commerce sellers. Sales volumes skyrocket, and consumer expectations are at an all-time high. Here's how Flipkart's Regional Inventory Shift impacts sellers during this time: 1. Higher Sales Potential With the shift in inventory, sellers can increase their reach by placing products closer to a broader audience. By fulfilling orders faster and reducing delivery delays, they can capitalise on the higher traffic during festive sales events. 2. Competition with Other Sellers Sellers who fail to optimise their inventory for Flipkart’s regional shift risk losing out to competitors who can offer faster delivery. The difference in delivery speed can play a huge role in attracting customers who are looking for quick solutions. 3. Challenges in Inventory Management While regional inventory offers numerous benefits, it can be challenging for sellers to manage multiple warehouses. Sellers must keep track of stock levels across different regions to avoid overselling or running out of stock. They also need to ensure that their products are correctly distributed to the right regional warehouses. 4. Leveraging Flipkart’s Tools for Effective Inventory Management Flipkart provides various tools and support for sellers to manage their regional inventory. These include: Flipkart Fulfillment Services (FFS) allow sellers to store products in Flipkart’s regional warehouses. Seller Hub for tracking real-time inventory data and demand trends. Automated stock reallocation based on regional demand. By using these tools, sellers can efficiently manage their inventory and focus on optimising their listings for the festive season. Suggested read: Navigating Flipkart’s New Rate Policy: Tips for E-commerce Sellers WareIQ: Redefining E-Commerce Fulfilment Regarding multi-channel fulfilment solutions, WareIQ stands out as a trusted partner for businesses of all sizes. Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfillment across D2C, Marketplaces, Quick Commerce, and B2B (General Trade & Modern Trade) Why Choose WareIQ? Pan-India Network: We operate a vast network of Seller Flex and FAssured compliant centers in over 12 cities, ensuring efficient last-mile delivery across more than 27,000 pin codes. Multi-Channel Fulfilment Platform: With plug-and-play integrations for major marketplaces like Amazon, Flipkart, and Myntra and D2C platforms such as Shopify and Magento, our platform supports seamless fulfilment across distributors and flagship stores. Advanced analytics capabilities help assess operational performance effectively. AI-Led Inventory Management: Our Inventory LogIQ solution minimises stockouts and automates replenishment, ensuring optimal inventory levels. Tech-Enabled Returns Management: We provide a sophisticated returns quality control solution that captures and stores media evidence of returned products, helping eliminate marketplace claim rejections. Comprehensive Seller Support: Benefit from dedicated account management, assistance with APOB/PPOB registrations, GST registration, and verification processes for NDR & COD. For businesses looking to scale their operations and enhance customer satisfaction, WareIQ offers a reliable, tech-driven solution. Learn more at WareIQ’s website. Key Takeaways for Sellers As Flipkart's Regional Inventory Shift continues to evolve, here are some important points for sellers to remember: Regional Warehousing is essential for reducing delivery times and costs. Sellers must understand Flipkart’s allocation process and ensure their products are well-positioned in the right regions. Utilise Analytics Tools offered by Flipkart to manage inventory effectively. This helps in optimising stock levels and reducing operational disruptions during the festive season. Focus on Customer Experience: Quick deliveries, accurate inventory tracking, and reliable customer support are key to standing out in the competitive festive season market. By embracing Flipkart's Regional Inventory Shift, sellers can ensure their businesses are well-prepared for the upcoming festive season, driving both sales and customer satisfaction. Suggested read: Flipkart Launching 100 Dark Stores for Quick Commerce FAQs about Flipkart's Regional Inventory Shift What is Flipkart's Regional Inventory Shift, and how does it work?Flipkart's Regional Inventory Shift is a decentralised inventory management strategy where products are stored in regional warehouses closer to customers. This approach helps reduce delivery times and shipping costs, especially during high-demand periods like the festive season.Why is Flipkart's Regional Inventory Shift important for sellers?This strategy enables sellers to improve delivery speed, reduce shipping costs, and cater to regional demand effectively. It helps sellers gain a competitive edge and enhances customer satisfaction during peak sales periods.How can sellers optimise their operations with Flipkart's Regional Inventory Shift?Sellers can utilise Flipkart’s fulfilment services and tools, such as real-time inventory tracking and demand analytics, to allocate stock strategically and manage regional demand efficiently.Does Flipkart's Regional Inventory Shift affect delivery times?Yes, Flipkart's Regional Inventory Shift significantly reduces delivery times by placing inventory in warehouses closer to customers, enabling quicker last-mile deliveries and enhancing customer experience.What challenges might sellers face with Flipkart's Regional Inventory Shift?Managing inventory across multiple regional warehouses can be complex. Sellers must monitor stock levels, prevent overstocking or stockouts, and ensure optimal distribution to meet regional demand effectively.

February 05, 2025
Flipkart Launching 100 Dark Stores for Quick Commerce

Flipkart Launching 100 Dark Stores for Quick Commerce

The festive season is synonymous with bustling markets and skyrocketing online orders, and Flipkart Launching 100 Dark Stores for Quick Commerce is a game-changer in this space.As a frontrunner in India's e-commerce industry, Flipkart’s decision to expand its swift commerce network with 100 dark stores for quick commerce is a bold step aimed at catering to the surging demand for faster deliveries.Let’s explore how this strategic move impacts businesses and what it signifies for the evolving quick commerce landscape. What Are Dark Stores and Why Are They Important? Dark stores are retail outlets that function exclusively as fulfilment centres for online orders. Unlike traditional brick-and-mortar stores, they do not cater to walk-in customers. Instead, they are optimised for order picking, packing, and swift dispatch. Key Features of Dark Stores: Strategic Locations: Positioned close to high-demand areas to reduce delivery time. Efficient Layouts: Designed for quick inventory access and streamlined operations. Technological Integration: Equipped with advanced inventory and order management systems. For businesses, dark stores ensure faster deliveries, reduced last-mile logistics costs, and improved customer satisfaction. Flipkart’s expansion into this model aligns perfectly with the growing consumer preference for same-day or next-day delivery. Flipkart’s Vision Behind Launching 100 Dark Stores Flipkart’s decision to launch 100 dark stores is driven by a commitment to enhance its quick commerce capabilities. These stores will serve as pivotal nodes in Flipkart’s supply chain, ensuring customers receive their orders within hours.  The company aims to leverage these fulfilment centres to meet festive season demands and sustain a competitive edge against rivals like Amazon and Reliance’s JioMart. Strategic Goals: Faster Deliveries: Dark stores will enable hyperlocal deliveries, reducing delivery times significantly. Enhanced Customer Experience: Faster deliveries contribute to higher customer satisfaction and loyalty. Optimised Supply Chain: By decentralising inventory, Flipkart can manage demand fluctuations more effectively. Driving Festive Sales: The strategic timing of this expansion ensures Flipkart can handle the seasonal spike in orders efficiently, meeting customer expectations during this critical period. The Growing Demand for Quick Commerce The quick commerce market in India has witnessed exponential growth in recent years. According to a recent report, the sector is projected to grow at a compound annual growth rate (CAGR) of 17% between 2023 and 2027.  Factors such as increased internet penetration, smartphone usage, and changing consumer behaviour have fuelled this trend. Key Drivers: Urbanisation: Growing urban centres demand faster, more reliable delivery options. Busy Lifestyles: Modern consumers prioritise convenience, valuing quick access to essentials. Competitive Pricing: Attractive discounts and offers make quick commerce platforms appealing. Tech-Savvy Consumers: With a growing population of digital natives, the demand for seamless e-commerce experiences continues to rise. Flipkart’s entry into the dark store model underscores its commitment to tapping into this lucrative market. How Flipkart’s Dark Stores Work? The 100 dark stores for quick commerce will operate as micro-fulfilment centres, handling orders for specific localities. Here’s how they function: Order Placement: Customers place orders through Flipkart’s app or website. Inventory Check: The system identifies the nearest dark store with the required items in stock. Order Fulfilment: Staff pick, pack, and dispatch orders within minutes. Last-Mile Delivery: Dedicated delivery personnel ensure orders reach customers promptly. This model ensures faster turnaround times and reduces logistical inefficiencies. Additional Advantages: Eco-Friendly Deliveries: By minimising the distance travelled for deliveries, dark stores contribute to reduced carbon emissions. Customisation Opportunities: Flipkart can use these stores to trial localised product offerings based on regional demand. Benefits for Businesses and Customers Flipkart’s 100 Dart stores for quick commerce benefits for businesses as well as customers as follows: For Businesses: Cost Efficiency: Centralised inventory reduces warehousing and logistics costs. Scalability: Dark stores can be scaled up or down based on demand. Real-Time Analytics: Data-driven insights into consumer preferences and buying patterns. Festive Readiness: Businesses can leverage dark stores to meet the high demand during peak seasons without compromising on delivery speed. For Customers: Convenience: Access to a wide range of products delivered within hours. Reliability: Consistent and timely deliveries, even during peak seasons. Personalization: Hyperlocal focus enables tailored offerings. Improved Festive Shopping Experience: Customers can shop for last-minute gifts and essentials with the assurance of timely delivery. Challenges and Flipkart’s Strategies to Overcome Them Despite the benefits, implementing a dark store model comes with challenges: 1. Inventory Management: Dark stores require precise inventory management to prevent stockouts and overstocking. Solution: Flipkart leverages advanced AI-based tools to optimise inventory levels. 2. Operational Costs: Setting up and maintaining dark stores can be expensive. Solution: Flipkart’s economies of scale and technological expertise help minimise costs. 3. Workforce Management: Efficient operations depend on skilled staff. Solution: Comprehensive training programmes for store personnel ensure seamless operations. 4. Last-Mile Delivery Challenges: Timely delivery in congested urban areas can be tricky. Solution: Flipkart employs robust route optimisation tools and a dedicated fleet to ensure smooth last-mile delivery. Suggested read: Top 11 Quick Commerce Companies in India Industry Impact and Competitive Landscape Flipkart’s bold move intensifies competition in the e-commerce space. Rivals like Amazon and JioMart are also exploring similar models to stay relevant. According to a statistical study, India’s e-commerce market is expected to exceed $120 billion by 2026, and quick commerce is set to play a significant role in this growth. Key Competitors: Amazon: Already experimenting with micro-fulfilment centres for faster deliveries. JioMart: Leveraging Reliance’s retail network for hyperlocal deliveries. Zepto: A dedicated quick commerce player focused on ultra-fast grocery deliveries. Swiggy Instamart and Blinkit: Dominating the quick grocery delivery segment with innovative service models. Flipkart’s focus on scaling operations during the festive season positions it as a strong contender in this dynamic market. Also check - Flipkart's Seller Protection Fund (SPF) Policy Guide for 2025 WareIQ: Redefining E-Commerce Fulfilment Regarding multi-channel fulfilment solutions, WareIQ stands out as a trusted partner for businesses of all sizes. Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfilment across D2C, Marketplaces, Quick Commerce, and B2B (General Trade & Modern Trade). Why Choose WareIQ? Pan-India Network: We operate a vast network of Seller Flex and FAssured complaint centres in over 12 cities, ensuring efficient last-mile delivery across more than 27,000 pin codes. Multi-Channel Fulfilment Platform: With plug-and-play integrations for major marketplaces like Amazon, Flipkart, and Myntra and D2C platforms such as Shopify and Magento, our platform supports seamless fulfilment across distributors and flagship stores. Advanced analytics capabilities help assess operational performance effectively. AI-Led Inventory Management: Our Inventory LogIQ solution minimises stockouts and automates replenishment, ensuring optimal inventory levels. Tech-Enabled Returns Management: We provide a sophisticated returns quality control solution that captures and stores media evidence of returned products, helping eliminate marketplace claim rejections. Comprehensive Seller Support: Benefit from dedicated account management, assistance with APOB/PPOB registrations, GST registration, and verification processes for NDR & COD. For businesses looking to scale their operations and enhance customer satisfaction, WareIQ offers a reliable, tech-driven solution. Learn more at WareIQ’s website. Suggested read: Flipkart’s New Rate Policy: Tips for E-commerce Sellers Summing Up Flipkart launching 100 dark stores for quick commerce is a testament to the company’s innovative approach to e-commerce. Flipkart aims to set a new benchmark in the quick commerce sector by focusing on speed, efficiency, and customer-centricity.As the festive season unfolds, businesses and consumers alike can look forward to seamless, lightning-fast deliveries. In the rapidly evolving e-commerce landscape, Flipkart’s bold move serves as a powerful reminder of the importance of adaptability and innovation. FAQs on Flipkart Launching 100 Dark Stores for Quick Commerce What is the purpose of Flipkart launching 100 dark stores for quick commerce?Flipkart is launching 100 dark stores for quick commerce to enhance delivery speed and customer experience. These stores act as micro-fulfilment centres, ensuring faster deliveries and improved supply chain efficiency.How will the 100 dark stores for quick commerce benefit Flipkart customers?The 100 dark stores for quick commerce will enable hyperlocal deliveries, allowing Flipkart to fulfil orders within hours. This ensures convenience and timely service, especially during the festive season.What products will Flipkart’s dark stores for quick commerce handle?Flipkart’s 100 dark stores for quick commerce will cater to a wide range of products, including groceries, daily essentials, and other high-demand items. These stores are designed for efficient and rapid fulfilment.How does Flipkart's dark store model impact its supply chain?By launching 100 dark stores for quick commerce, Flipkart decentralises inventory, reducing last-mile delivery time and operational costs. This model optimises supply chain efficiency and meets rising consumer expectations.Why is Flipkart focusing on quick commerce during the festive season?The festive season sees a surge in online shopping. With 100 dark stores for quick commerce, Flipkart aims to handle increased demand, ensuring timely deliveries and a superior customer experience.

February 04, 2025
Difference Between Excise Duty and Custom Duty: A Comprehensive Comparison

Difference Between Excise Duty and Custom Duty: A Comprehensive Comparison

Excise and customs duties are two important forms of taxation in a country. One is related to internal trade, while the latter is associated with international trade. They play a key role in regulating trade and revenue generation for a country. However, the distinction between them is often misunderstood. Knowing the difference between excise duty and custom duty is imperative. It helps businesses remain compliant with tax laws, manage costs effectively, and align their operations with regulatory requirements. What is Excise Duty? Excise duty is a tax applicable to manufacturing, selling, or consuming specific products and services within a country. Excise duty is in the purview of end consumers. Instead, manufacturers and respective service providers are bound to pay it. However, it can impact end consumers through product price increases. Alcoholic products, fuel, tobacco, wine, and gambling services typically come under excise duty. The government uses the tax accrued to fund various public services and projects, underscoring the importance of excise duty. When it comes to the rules and regulations, each country can have its own.  What is Custom Duty? You might be familiar with tariffs or import duties. That’s exactly the customs duty, which relates to foreign trade mostly. It is the tax levied on goods or services imported into a country by an industry or an individual. Every country will have its own rules for customs duty designed to regulate international trade, protect domestic industries, and generate revenue for the government. Ultimately, the importance of custom duty also lies in funding the government to develop public projects and services in a country.  Difference Between Excise Duty and Custom Duty AspectExcise DutyCustoms DutyDefinitionTax imposed on the production or sale of goods within a country.Tax levied on goods imported into a country.ScopeApplicable to goods manufactured and sold domestically.Applicable to goods entering the country through import.Point of LevyCharged at the manufacturing or production stage.Charged at the point of entry at customs checkpoints.PurposeTo generate revenue and regulate domestic industries.To generate revenue, protect local industries, and manage trade policies.Collection AuthorityCollected by government agencies from manufacturers or producers.Collected by customs authorities from importers.Calculation BasisIt can be ad valorem (percentage of value), specific (fixed amount per unit), or compound.Based on customs valuation, duty rates, and international trade agreements.Goods AffectedApplicable to domestically produced goods and services.Applicable only to imported goods.Rate DeterminantsRates depend on the type of goods or services.Rates depend on HSN codes, the origin of goods, and trade agreements.Additional ChargesMay include excise cess, surcharge, or other levies.It may include anti-dumping duties, countervailing duties, or safeguard measures.Exemptions/RebatesExemptions or rebates may apply to essential goods, exports, or specific industries.Exemptions may apply under free trade agreements or special economic zones.Compliance ResponsibilityManufacturers, producers, and service providers must comply with excise regulations.Importers must declare goods and comply with customs procedures.Impact on PricingInfluences the cost of domestically produced goods and services.Directly affects the cost of imported goods.Effect on International TradeDoes not usually impact international trade directly.Impacts trade by influencing import costs and promoting protectionist measures.Documentation RequiredExcise registration, invoices, and tax returns.Import/export documentation, bill of entry, and customs declarations.Refund ProvisionsRefunds may be available for exports or under special schemes.Refunds may be available for overpaid duties or under certain trade agreements. Importance of Excise Duty vs Custom Duty We must understand that the objectives of custom duty and excise duty are not just about taxation. They have a lot to contribute towards a country's economic and social development.  FactorImportance of Excise DutyImportance of Custom DutyRevenue GenerationRaises funds from goods produced domestically.Generates revenue from imported goods.Support for IndustriesIt helps local industries by regulating domestic production.Protects domestic industries by taxing imports.Control on GoodsRegulates harmful or luxury goods like tobacco and alcohol.Ensures quality and legality of imported goods.Economic StabilityIt helps manage inflation by taxing non-essential domestic goods.Balances trade by controlling import costs.Public Services FundingFunds government programs like education and healthcare.Supports border security and trade infrastructure.Environmental ImpactDiscourages production of harmful goods through higher taxes.Discourages import of environmentally damaging goods.Trade PolicyLimited direct impact but influences domestic markets.Implements trade policies like tariffs and free trade agreements. Types of Excise Duty & Calculation There are different types of Excise duties based on their application and purpose.  Basic Excise Duty: A standard duty applied to most goods manufactured within the country. For example, excise duty on the production of smartphones. Special Excise Duty: An additional duty imposed on specific goods, often for regulatory or revenue purposes. For example, on tobacco products. Additional Excise Duty: Charged on items such as luxury goods or non-essential commodities. For example, additional excise duty on high-end cars. Education Cess on Excise Duty: A small percentage of the excise duty is added to fund educational programs and initiatives, for example, on electronics. National Calamity Contingent Duty (NCCD): A duty levied to support disaster relief and rehabilitation efforts. NCCD imposed for funding rehabilitation in disaster-affected regions. Calculating Excise Duty Excise duty is calculated based on the value or quantity of goods manufactured within a country. It involves specific formulas and depends on the type of goods, their classification, and applicable tax rates. Ad Valorem Basis Excise duty is calculated as a percentage of the assessable value of goods. Formula: Excise Duty = Assessable Value × Applicable Excise Duty Rate Example: If the assessable value of a product is ₹1,000 and the excise duty rate is 10%, the duty is ₹100. Specific Basis A fixed amount is charged per unit of goods, regardless of their value. Formula: Excise Duty = Quantity Produced × Duty Per Unit Example: If the duty is ₹5 per litre and 1,000 litres are produced, the excise duty is ₹5,000. Compound Basis A combination of ad valorem and specific rates is applied. Formula: Excise Duty = (Assessable Value × Rate) + (Quantity × Fixed Duty) Types of Custom Duty & Calculation Basic Customs Duty: The standard tax imposed on goods imported into a country, calculated based on their value. Example: Duty on imported electronic devices. Countervailing Duty (CVD): Aimed at neutralising subsidies provided by the exporting country, this duty ensures fair competition for domestic industries. Example: CVD on imported subsidised steel. Special Additional Duty (SAD): An extra layer of tax added to specific imported goods to maintain balance in domestic markets. Example: SAD on luxury items like premium watches. Anti-Dumping Duty: Enforced to prevent imported goods from being sold at unfairly low prices that undercut local businesses. Example: Anti-dumping duty on underpriced imported steel. Safeguard Duty: A temporary measure to protect domestic industries from a sudden surge in imports. Example: Safeguard duty on agricultural imports during high domestic production. Preferential Duty: Lower or waived duties applied to imports from countries under special trade agreements. Example: Reduced tariffs on goods from free trade partners. Protective Duty: Designed to support emerging domestic industries by discouraging foreign competition. Example: Duty on imported solar panels to boost local manufacturing. Education Cess: An additional charge on customs duties allocated to funding educational initiatives. Example: Cess applied to imported educational materials. Integrated Goods and Services Tax (IGST): A unified tax replacing multiple levies, applicable on imported goods. Example: IGST on machinery brought into the country. How to Calculate Custom Duty? Customs duty is calculated based on the assessable value of imported goods and the applicable duty rates. Here's the process: Determine the Assessable Value The assessable value includes: Cost of Goods (FOB Value): Price paid for the goods. Freight Charges: Cost to transport goods to the importing country. Insurance Charges: Cost of insuring the goods during transit. Assessable Value = FOB Value + Freight + Insurance Apply Basic Customs Duty (BCD) Calculate the duty using the assessable value and the BCD rate. Basic Customs Duty = Assessable Value × BCD Rate Add Additional Duties Include applicable duties such as: Countervailing Duty (CVD): Levied to offset subsidies. Special Additional Duty (SAD): Imposed on specific goods. Anti-Dumping or Safeguard Duty: Applied in specific scenarios. Calculate Integrated Goods and Services Tax (IGST) IGST is calculated on the total of assessable value, BCD, and other duties.IGST = (Assessable Value + BCD + Other Duties) × IGST Rate Add Other Charges Include charges like Education Cess or specific duties based on the nature of the goods. Calculation FOB Value: ₹1,00,000 Freight: ₹10,000 Insurance: ₹5,000 BCD Rate: 10% IGST Rate: 18% Assessable Value = ₹1,00,000 + ₹10,000 + ₹5,000 = ₹1,15,000BCD = ₹1,15,000 × 10% = ₹11,500IGST = (₹1,15,000 + ₹11,500) × 18% = ₹22,770Total Customs Duty = ₹11,500 + ₹22,770 = ₹34,270 Customs duty calculations can vary based on agreements, exemptions, and special duties. You must always refer to current tariffs and rules prevailing in a country. Related read: Import Duties and Customs Clearance in India for International Brands WareIQ: Powering Fulfillment and Shipping for eCommerce Growth WareIQ is a Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfilment for D2C, marketplaces, quick commerce, and B2B businesses. The Advantage of WareIQ Pan-India Fulfillment Network: Seller Flex and FAssured compliant centres across 12+ cities with last-mile delivery to 27,000+ pin codes. Tech-Enabled Solutions: AI-led inventory planning, plug-and-play integrations for multi-channel fulfilment, and returns QC to eliminate marketplace claims rejections. Quick Commerce Support: Regional inventory placement and timely dispatch to platforms like Blinkit, Zepto, and Instamart. Premium Seller Enablement: Rapid marketplace launches with operational and compliance support for cataloguing, GST registration, and APOB approvals. Smart Shipping: Minimized RTOs, precise delivery options, and branded tracking for an enhanced customer experience. With WareIQ, businesses can streamline operations, reduce costs, and scale efficiently in the competitive eCommerce landscape. Closure Exploring the difference between excise duty and custom duty is non-negotiable for businesses. But managing them efficiently is equally important. B2B companies, particularly manufacturers and importers, should invest in robust compliance tools and partner with reliable logistics providers to streamline tax processes.  Allow for regular audits and stay updated on regulatory changes to prevent penalties and optimise cost management. Onboarding expert advice promises your operations to align with tax laws. After all, sustainable growth in a competitive marketplace is the need of hour. Suggested read: Vendor vs Supplier Key Differences and Their Impact on Supply Chain Management FAQs What is the custom duty rate in India?The peak customs duty rate in India is currently around 10%, representing the highest basic duty applied to the majority of imported goods. Additionally, a Social Welfare Surcharge of 10% is levied on the value of goods. It further contributes to the overall import cost for businesses.What are the types of customs duty in GST?At present, under GST in India, some customs duties are included in IGST. They are Countervailing Duty (CVD) and Special Additional Duty (SAD). However, Basic Customs Duty (BCD), Anti-Dumping Duty, and Safeguard Duty remain separate and are still applied on imports.What is the primary difference between excise duty and customs duty?The primary difference is that excise duty is a tax on goods manufactured within a country, while customs duty is a tax on goods imported into a country from abroad.Is GST applicable on customs duty?Yes, GST is applicable on customs duty in the form of Integrated Goods and Services Tax (IGST).

February 03, 2025