Binny Bansal, who is the newly appointed chief executive of Flipkart, will keep control of the company’s logistics arm as the home grown e-retailer opens it for outside customers and is building a consortium of players in logistics’ industry.
Flipkart restructured teams in its retail and marketplace divisions soon after Binny Bansal took over from friend and co-founder Sachin Bansal. Mukesh Bansal, Myntra’s co-founder, who headed the commerce platform initially, will now manage the advertising business that Sachin Bansal started.
The logistics arm of Flipkart was the only business that hadn’t seen a change. Flipkart is keen on adding partners in the logistics part of business, for which the company has ambitious plans. It has set aside $2.5 billion and plan to spend it to strengthen logistics in the next 2-3 years. In that regard, the company is picking up stakes in some firms. Logistics start-ups BlackBuck, an online freight booking platform, and QikPod, a product and service start-up, are the two companies Flipkart has invested in so far, and has taken a crucial stake in MapMyIndia, a mapping company in India. On the other hand, Tracxn, a firm which has the founders’ personal stakes, has invested in Parcelled and Opinio.
Logistics is the biggest hurdle in India’s eCommerce operations today. When opening a platform for third parties, Flipkart will fulfil the last-mile delivery needs of other players. All the partners that the company is tying up with function in a different area under the larger logistics space, and some even achieving titles of being a niche player. While BlackBuck enables inter-city freight delivery, Delhivery is a provider of e-commerce logistics and Opinio is a hyperlocal player. Flipkart’s own logistics arm eKart would be the next big priority for the e-retailer, which it had purchased from WS Retail, the largest seller on Flipkart.
Snapdeal, too is betting big on logistics in 2016. It could be seen from the fact that the company has set aside $300 million to strengthen its supply chain and logistics operations, apart from claiming to have reduced delivery times considerably.
Snapdeal has made 10 acquisitions in the past year in the technology, supply chain and payments space. The company also holds an estimated 42 per cent stake in logistics firm Gojavas, which is Snapdealâ€Ÿs largest supply chain and delivery partner.