Post Date : April 28, 2022
Ecommerce giant Flipkart opens its internal logistics arm Ekart to other e-commerce players, the Flipkart Group CEO Kalyan Krishnamurthy discussed this at a company town hall on Wednesday, said people who were privy to the matter.
According to sources, Ekart added about 30 clients and is looking to onboard more as it doubles down on leveraging its internal logistics infrastructure to service non-Flipkart orders.
Flipkart before its’ Walmart deal in 2018 had once tried opening up Ekart to external platforms on a small scale. However, the project wasn’t expanded as the company was still figuring out how to best serve its order volumes.
“This time, they (Flipkart) are going to double down on Ekart serving non-Flipkart group orders as existing group businesses are covered at scale by the in-house logistics infrastructure,” a person aware of the matter said.
Going forward, we can expect orders for companies such as Nykaa, FirstCry and others to be delivered by Ekart.
“The opening up was gradually done from January onwards and now it has about 30 companies including Snapdeal and others,” one of the sources said.
Sources in third-party logistics companies have also confirmed that Ekart has held talks with several e-commerce platforms to fulfill their shipments. “It looks like they are serious about it this time,” an executive at a logistics firm said.
Flipkart and Amazon service most of their orders through their in-house logistics firms – Ekart and Amazon Transport Services. However, e-commerce platforms such as Meesho and direct-to-consumer brands work with third-party companies such as Delhivery, Ecom Express, and Xpressbees.
While Flipkart’s logistics arm is open to external customers, it is unlikely that the company will offer its services to its direct competitors Amazon India or Meesho.
In the town hall meeting, Krishnamurthy also said Flipkart was in the early stages of building its non-fungible token (NFT)-related business. He said this in response to a question by a Flipkart employee on whether the company was looking to bring in web3-related products.
While this is a work in progress for the Bengaluru-based firm, it could be the first instance of a homegrown etailer hosting NFTs. Sources said, internally, the company is aiming to have the NFT project ready by BigBillionDays, its annual Diwali sale.
The e-commerce giant is currently looking to focus on the ‘localization’ factor for NFTs. Since NFT sales in India have been low, the company is likely to double down on creating awareness, providing utility-driven NFTs, and possibly linking them with physical products.
“You can’t just clone a successful model in the West, like selling a moment in sports. They (Flipkart) want to go after what the Indian audience and user understands and those are a lot more around a physical product, value, and utility,” said a person familiar with the plans.
He added that different products and brands will take different approaches to monetize NFTs and that it could include infrastructure tools for brands to use.
While plans may still change, Flipkart currently is thinking of using its flagship sale event later in the year to unveil NFT-related products.
Krishnamurthy also said that the Walmart-owned etailer is working on its initial public offering. However, a timeline for the same was not provided.
Early media reports suggested that the e-tailer was in early work on the Flipkart IPO and that the company was looking at a timeline of the financial year 2023 for its public offering.
But, the choppy markets and overall correction in valuation for large startups and e-commerce firms, is likely to alter this timeline, sources added. The matter is yet to be taken to its board for formal approval.
In July 2021, Flipkart was valued at $37.6 billion, after raising $3.6 billion in a round led by Canada Pension Plan Investment Board, the Singapore government’s sovereign wealth fund GIC, Japan’s SoftBank Vision Fund 2, and Flipkart’s largest shareholder Walmart, with participation from existing backers such as Qatar Investment Authority.