Flipkart has appointed half-a-dozen companies as intermediaries between its wholesale unit and some preferred sellers on its platform to get around the 25% cap on direct purchases from entities related to marketplaces, two people familiar with the development said.
Sports Lifestyle Pvt, Premium Lifestyle & Fashion India Pvt and Wishberry Online Services are among the intermediaries that will purchase products from Flipkart wholesale and supply them to preferred sellers including SuperComNet, OmniTech Retail and RetailNet, which will then offer them on Flipkart, they said.
Flipkart did not respond to an emailed questionnaire seeking comments. Premium Lifestyle declined to comment, while Wishberry and Sports Lifestyle did not respond to ET’s queries.
The latest restructuring of Flipkart’s operational model follows the tightening of foreign investment rules in e-commerce from February. India allows FDI only in marketplaces that offer platforms for other businesses and sellers and bars them from holding inventory and influencing p rices .
The rules state that a vendor will be considered “controlled” by an online marketplace operator if it sources more than 25% of its merchandise from an entity related to the e-commerce company.
ET reported on February 19 that Flipkart was creating a layer of business-to-business entities to act as intermediaries between its wholesale arm and prominent sellers on its platform.
On e person said the intermediaries are yet to start supplying Flipkart’s bunch of preferred sellers.
Meanwhile, prominent Flipkart vendors are purchasing the bulk of their wares directly from consumer companies or their distributors and are purchasing less than 25% of their merchandise from Flipkart India, the wholesale arm of Bengaluru-based Flipkart Group, which Walmart acquired for $16 billion in May.
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