Leading ecommerce company Flipkart has announced that it will be opening its largest warehouse yet in Telangana. The Bangalore- headquartered company has chosen to set up its 16th warehouse in Telangana as against Karnataka.
The new warehouse, located in Hyderabad, has an area of 2.2 lakh square feet, said to be as large as three football fields. Once the warehouse begins its functioning, it will be shipping out 1.2 lakh goods on a daily basis, say reports.
Hi-fi features to rule the new facility
The new warehouse will have automated segregators and conveyor belts to bring down instances of error. The automated features will be the first for any Flipkart warehouse.
“This is the first attempt by Flipkart to use automation,” said Binny Bansal, who is now in charge of the supply chain post the reorganization. The new facility is said to generate 2,000 direct jobs, and close to 10,000 plus indirect jobs.
Problems with Karnataka government on taxation issues
Currently the Bangalore- based company has three fulfilment centres in Bangalore alone. However, confusion in the taxation laws have clearly influenced the company’s move to Telangana. Binny Bansal expressed this in no uncertain terms,
“We don’t have clarity on regulatory aspects for e-commerce here (Karnataka). If there is no clarity on the e-commerce taxation, no one would want to set up warehousing facilities here. There is an ongoing dialogue with the government and we hope to reach some clarity within a few days,” he said. “There is clarity on taxation in Telangana. From there, we hope to reach 70% of our customers in South India in a single day,” said Bansal.
Clearly, Karnataka’s loss has been Telangana’s gain.
More warehouses to join the family
Flipkart currently has 16 warehouses and is planning to take this number up to 50 to 100 over the next five years. The company plans to pump in a sizeable amount as investment for this.
“We would end up investing somewhere around $300-500 million in the next five years,” said Binny Bansal.
The expansion is to facilitate the increasing sales. The company is looking at sales worth $10 billion by the end of 2016. By 2017, Flipkart will have deliveries nearly ten times the current volume.
It is no surprise that ecommerce companies are the future of the economy. In this scenario, it is important for local governments to make provisions and provide facilities to the industry. If not, growth and development will not take place, and other states will reap the benefits of the rise of ecommerce.
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