Flipkart Acquires Walmart’s Cash and Carry
On 23rd July 2020, Flipkart announced the acquisition of Walmart’s cash and carry business, Best Price, to strengthen its wholesale marketplace operations. This move lays the groundwork for Flipkart to compete with rivals Amazon, Reliance’s JioMart and Udaan to in an attempt to lure kiranas and local shop owners. Flipkart will launch its wholesale unit next month with categories like fashion and grocery.
Indian retail landscape is suddenly abuzz with talks of mergers and partnerships. Amazon, JioMart, and Future Group are just some of the players at the forefront of this being the big-daddies of this sector. Their growing interest in brick & mortar can be attributed to the digitization drive that has got a sudden thrust. This pandemic has persuaded retailers that technology is the way forward for their businesses. This has opened up a new market for eCommerce players as they can use their strong online presence with the user base of retailers. At least in the case of Flipkart, they will be holding power on both sides of the ecosystem.
However, this move has been discouraged by the All India Online Vendors Association (AIOVA), which is an alliance of sellers, who have approached the Competition Commission of India (CCI) against this deal. They claim that this acquisition will lead to preferential treatment for a few sellers. Also, the ongoing investigation by the CCI against Flipkart for abuse of dominant position should play an important factor. With all the current activities regarding the retail sector, it is shaping up to be a riveting period for eCommerce giants and Kirana owners.