Flipkart could get much awaited capital; eBay’s proposed participation raises hopes of second innings

There is finally a glimmer of good fortune for Indian ecommerce bellwether Flipkart. The company has found investors who are contemplating an investment of $1.5 billion. The figure is close to what the company had expected to raise. After its series of devaluations, Flipkart is finally having some good turns.

American ecommerce firm eBay and Chinese investment company Tencent are reportedly the chief participants. An anonymous insider confirmed this,

“Talks with eBay are at an advanced stage, and a strategic deal may include Flipkart acquiring or merging their India operations.”

eBay is planning to put about $ 400-500 million. However, Tencent’s figures are not known, as a third-party investor is also likely to be roped in. Flipkart’s major investor Tiger Global’s role in the funding is not clear.

Good for everyone

Sreedhar Prasad, partner for ecommerce and startups, KPMG India says that the move will benefit the overall health of Indian ecommerce. He says,

“The current round of funding will provide a much-needed boost and improve the sentiment towards ecommerce and the overall startup sector in India. Apart from the company, the ecommerce ecosystem partners such as logistics companies and others will benefit.”

The road to raising funds appears rocky

Flipkart’s funding rounds so far are as follows:

• Tiger Global invested a total of $ 30 million between 2010 and 2011.
• The company got a total of $ 360 million in 2013 in Series E funding rounds.
• It raised $ 1 billion in 2014 from Tiger Global and others.
• Later that year, it got $ 700 million from Qatar Investment Authority, Greenoaks Capital and others in a Series H round.
• In 2015, it was looking at $ 550 million from Tiger Global and others. It got $ 700 million from private equity.
• Late last year, the company considered approaching investment banks to raise capital.
• The company is working hard to increase its valuation so that it gets a significant amount.

eBay’s second innings

Everyone knows that eBay did not impress Indian shoppers despite its early entry into the market. Sellers too felt that selling on eBay wasn’t rewarding enough. It tried to wiggle back in to deal with the competition (better services, introducing a concierge service on Twitter, trying its hand at fashion-), but the attempts remain unsuccessful. Perhaps its investment idea could help both Flipkart and itself.

Alibaba.com to help boost online exports through workshops

Trading platform Alibaba.com hosted a workshop for Indian resellers of gold, jewellery and handicraft products here to help improve their business and expand their presence in the global markets. Alibaba.com is the global wholesale trading platform of Alibaba Group.

Over 350 resellers from these sectors came together to explore trade opportunities through e-commerce and mobile technology, it said in a statement. They discussed how to leverage online resources, including logistics and finance resources provided by Alibaba.com’s partners, to boost business locally and globally, the statement added.

“The gold, jewellery, handicraft as well as textile and leather industries are a major source of employment and revenue generation in the Indian market. Exports from India contribute significantly to the global market demand. However, we strongly believe that these sectors haven’t been tapped to its full potential,” said Chris Wang, Country Head, Alibaba.com, India.

“By organising the workshop with sellers in Mumbai, Surat and Kanpur, we were able to showcase how technology can enable the community to grow their business and expand in the global markets in the most cost-effective way,” he said.

By working with local partners, they want to support manufacturing clusters in India to expand their export globally, he added.

The workshop follows the Jewellery Fest in Jaipur in early 2016, and resellers workshops in textile in Surat, and leather in Kanpur last month.

HOME » IN THE NEWS • MARKETPLACE WATCH • SNAPDEAL » Snapdeal discontinues Cash on Delivery option for transactions beyond Rs. 20,000

After cutting down the payment time to sellers by 40%, Snapdeal has decided to slash its cash on delivery (COD) limit by 60%. The marketplace is trying to encourage more prepaid transactions this way and in turn reduce the return rate of goods to sellers.

Snapdeal has been in hot water on account of mounting seller troubles on its platform. This step should provide a bit of relief at least to big ticket item sellers. The etailer has confirmed that it will end the COD feature for transactions higher than Rs.20,000.

Prepaid orders reduce product returns

The platform has noticed that prepaid orders have resulted in far less returns when compared to COD orders.

The company’s spokesperson stated, “Earlier, the CoD cap was for transactions over Rs 50,000. However, it has been brought down by 60%. Accordingly, CoD order are restricted to Rs 20,000 thus making most of the high-value orders on our platform prepaid.”

Rival marketplaces Amazon and Flipkart have not yet altered their COD orders cap. Flipkart allows COD on transaction up to Rs.50,000 and Amazon on transactions up to Rs.30,000.

Snapdeal, on the other hand, began restricting COD transactions sometime during mid-January. This was done to reduce the number of fake orders and returns that hurt sellers dearly. After the demonetization announcement, the marketplace restricted COD orders due to the shortage of acceptable currency.

This restriction was discarded when the cash struggles were sorted and prepaid orders started catching on. Snapdeal’s spokesperson stated that after demonetization the number of prepaid transaction rose drastically.

The spokesperson said, “We believe that high-value orders should be prepaid and it is also good for both the e-marketplace as well as the sellers.”

Solutions to seller traumas

Snapdeal sellers have been complaining about payment defaults by the marketplace. In fact, many have allegedly threatened to quit the marketplace. To help sort out the issues sellers are facing, the marketplace meet with the Sanjay Thakur, the previous president of ESS (eSellerSuraksha) and discussed seller troubles on Snapdeal, on Wednesday.

Thakur informed Indian Online Seller, “We had a good and productive discussion with Snapdeal management, focused on growing business opportunities through progressive steps relating to reducing returns, increasing preference for prepaid orders and a smooth migration to GST regime. We are very reassured and encouraged with the responsive and supportive engagement and look forward to mutually beneficial business growth.”

Multiple disputes cases were put together and brought to the etailer’s notice. Based on reports 50% of these have been discussed and will be resolved in immediately. The remaining 50% are still being looked into on account of colexities associated with them, Thakur mentioned.

According to Snapdeal’s spokesperson, “There was no outstandings in terms of payment issues. They have forwarded some cases to us which were discussed separately and are being looked at in terms of their genuineness. While some cases have been settled already others will get settled in the due course.”

Flipkart’s FY16-17 sales figure to grow by 40%; 2 million products in Amazon’s next-day delivery stock

The game of one-upmanship continues between home-grown ecommerce leader Flipkart and American ecommerce giant Amazon’s India unit. The biggies are locked in a leadership tussle and both want the largest share of the Indian ecommerce pie.

So we have Flipkart boasting about its sales growth rate and Amazon about the size of its inventory.

Flipkart to record 40% sales growth in fiscal year 2016-2017

According to reports, Flipkart’s sales figure in the FY 2016-17 is most likely to increase by 40%. The percentage increase could have been more if not for demonetisation in the month of November and December, according to the etailer.

Flipkart’s COO Nitin Seth said,

“Our growth during the first half of the year was very limited in line with the industry trend. In the second half, particularly after Diwali, our growth took off in a big way barring November and December. We have done much better January onwards and we will end the current fiscal with a close to 40% growth over the previous year.”

With FY2017 close to its end, Flipkart is extremely confident about its growth in the next fiscal year 2017-2018. Seth believes that the company’s FY18 sales would increase by 60%. Flipkart’s business strategies such as expanding in tier 2 & 3 cities, launching grocery category and setting up new delivery units would fuel this growth, according to Seth. Other focus areas would be mobile phones, furniture and large appliances.

As of the now, the Bansals-led company is preparing for its upcoming funding round, amidst series of devaluations.

Amazon has 2 million products in its next-day delivery inventory

With billions in bank and millions in stock, Amazon India is gloating about its next-day delivery inventory. The company has over 2 million products in stock, which enables them to efficiently fulfil Amazon Prime orders and hyper-local business.

Akhil Saxena, VP, India Customer Fulfillment at Amazon India declared,

“Close to 2 million products are available for next day shipping which is by far the highest in the e-commerce industry. We pioneered the concept of premium guaranteed deliveries with the launch of one-day delivery within 6 months of our launch in India. Today we have services like the two day, one day, same day, release day, midnight, Sunday delivery (in over 200 cities) and now morning delivery (in Bangalore, Mumbai, Delhi/NCR and Hyderabad).”

Indian ecommerce leader Flipkart too is counting big on its grocery business. On the other hand, the firm had to shut its C2C courier and hyper-local delivery service.

Around the Ecommerce world in 5 mins!

Ecommerce is changing everyday, and sometimes by the minute. So many new ideas and developments everyday, becomes hard to keep track.

We bring to you a curated digest of ecommerce developments/happenings around the world, compiled from various publications across the Internet.

Seller gets unexpected £12k bill because Amazon undercharged on fees

In January we reported that Amazon had undercharged sellers in the Electronics Accessories Categories and intended to recoup the balance in the near future. It would appear that the bills have started rolling in. Amazon’s Seller Referral Fees for Electronics Accessories should be 12%, but they were incorrectly charged at just 7% for four months and Amazon want all those 5% undercharged fees paid up.

UK Online Shopping and E-Commerce Statistics for 2017

The market for online shopping is growing at a remarkable rate. Approximately 87% of U.K. consumers have bought at least one product online in the last 12 months, and the United Kingdom is second only to Norway for making e-commerce purchases in Europe. Across the world, nations such as China and the United States are the biggest online buyers, but other countries are catching up.

As Amazon Floods With Chinese Sellers, Western Brands Move Into China’s Booming E-Commerce Market

Alibaba’s Jack Ma recently boasted to Trump that his company will create one million jobs in the US via increased access to Chinese customers through its e-commerce platform. While this statement could probably at least partially be written off as hyperbole, e-commerce has gone global. Marketplaces like Amazon, Taobao, TMall, and JD are eroding the boundaries of political geography, as merchants in countries like China are being given access to customers in places like the USA while US merchants are being granted a direct link to end buyers in China.

UK Amazon sellers are least enthusiastic exporters in Europe

In terms of Europe, there are five key Amazon marketplaces: the UK, France, Germany, Spain and Italy. And a report has been examining how sellers in those 5, sell amongst themselves. It will hardly be a surprise to learn that the UK is the most popular market, and the biggest, when it comes to sellers in France, Germany, Italy and Spain. The result is, by percentage, the Brits are the least enthusiastic exporters by comparison.

Taiwan’s e-commerce sites losing ground to overseas competitors

40 percent of online purchases made in Taiwan are from overseas sellers, and 84.3 percent of online shoppers said they would be willing to buy from foreign vendors, according to statistics from Market Intelligence & Consulting Institute (MIC), a Taipei-based global ICT industry research organization. China accounted for the most-used cross-border e-commerce sites in Taiwan with 72.7 percent of respondents saying they shopped on Chinese online retailers.