Amazon India in talks with Dabur, Infosys to create largest seller

Cloudtail

In order to build largest merchant entities, Amazon India is reportedly approaching successful and prominent business families in the country.

Among the families approached are Burman, which owns consumer company Dabur and Infosys co-founder Kris Gopalakrishnan, said a report by ET quoting three people aware of the development. Sources mentioned in the report confirmed that talks are going on with the Burman family and a deal could get hammered out in the next couple of months. Whereas couple of discussions are in pipeline.

Amazon India is eyeing joint venture on the line of Cloudtail India, which is the the largest seller on Amazon, which is a 100% owned subsidiary of Prione Business Services, a joint venture of Infosys co-founder Narayana Murthy’s Catamaran Ventures and Amazon Asia.

Cloudtail, ended the year with revenue of Rs 4,591.2 crore, compared with Rs1,145.4 crore in last year. Cloudtail India was created in 2014. It is the only Platinum seller remaining on the platform, added report.

“Cloudtail has been doing well. These ventures help Amazon comply with the DIPP norms and exercise greater control over inventory, manage customer experience and comply with the regulations of GST for tax collection at source,“ said Satish Meena, senior forecast analyst at Forrester Research.

Cloudtail India reported a 300% increase in revenues to Rs 4,591 crore in FY16 while losses fell marginally to Rs 30.2 crore from Rs 31 crore the previous year, according to documents filed with the Registrar of Companies (RoC).

However, both the Dabur India and Infosys did not confirm the report of talks of joint venture.

Besides, E-commerce gaint is also waiting for exact GST structure, that was implemented on July 1, to get more clearer. With clarity on GST, which will make tracking sales to the entity much simple and easier.

Earlier, in March 2016, the Department of Industrial Policy and Promotion (DIPP) capped the sales originating from a single vendor on a marketplace at less than 25%.

Amazon has been growing and giving Flipkart a tough comptetion. It has been making every possible action to outruns home-grown Flipkart, which by latest report is leading the Indian e-commerce market. Flipkart’a key vendor, WS Retail, reported to bring over three-fourths of its sales for the company.

Recently, it launched Amazon Prime Day offers, subscription-based programme, which saw membership triple from January 2017 to June 2017, exclusively for members. The number of products under Prime has increased 70% to 2 million since the launch of the programme which guarantees one-day delivery in 100 cities.

According to Goldman Sachs, India’s e-commerce market is expected to grow to $103 billion by 2019-20 from $26 billion now.

 

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