Amazon’s food business to debut in Diwali; expands C2C sale platform

Diwali is more than two months away but the preparation for the biggest festive season has begun. Flipkart is revamping its large appliances category ahead of the festival. And rival Amazon is readying its online food business in order to launch it around Diwali.

The ecommerce biggie recently got the Indian government’s approval for FDI in food retail. And the aim is to take maximum advantage of the opportunity.

Amazon’s food plans include:

• Invest $500 million in this segment via Amazon Retail India Private Limited over 5 years
• Launch private labels under this category
• Sell locally grown and packaged food items from third parties

As of now, the etailer is dependent on existing brands and hypermarket to fulfil grocery orders. Amazon Pantry and Amazon Now (on-demand service) are the marketplace’s two grocery channels. But Amazon wants to change that by introducing its own food labels, just like they did in the US.

Industry watchers believe that Amazon’s ambitious plans for its grocery arm could start a price war among grocery players in India– offline as well as online.

Customer-to-customer sales platform to assist expansion

As if B2C (business to customer) and B2B (business to business) wasn’t enough, Amazon is also expanding its C2C (customer to customer) sales platform. The etailer’s C2C service ‘Local Finds’ was launched in Bengaluru in January this year. It allows customers to sell used items by registering as sellers on the platform. From books to handicraft items to accessories, the service is a huge hit with buyers who want to do business as well. After its successful run in Bengaluru, the service has now spread its wings in three more cities – Chennai, Hyderabad and Mumbai.

Amazon’s new initiatives Director Mahendra Nerurkar said,

“The Local Finds section has so far seen 30,000 transactions and at any given time, the platform has 15,000 to 20,000 live listings for a city like Bengaluru. Sell as an individual is a global programme and we have made some India specific tweaks to this.”

Since its launch, the etailer has made two major changes to its C2C platform. One was limiting the search results to one particular city and second was to provide assistance in packaging, shipping and other such order fulfilment services. Academic books are top-selling items. Music records, movies, and video games are few other products that are selling well on this platform.