Flipkart lowers seller commission, but there is catch

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Flipkart, which brought various changes in merchant policies in the past one year, has once again introduced new rules — this time, it has lowered the seller commission by 5% for items priced below Rs 300 across many categories.

“We have also hastened the payment settlement timeframe. Sellers in the ‘silver’ category will receive payments two days sooner. We are also giving sellers visibility, recommendation on what to bring to warehouses, data on which products are selling more and sharing intelligence and analytics as part of the new policy,” Anil Goteti, head of marketplace, Flipkart, told ET.

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But, some sellers are not happy with the move and they said such small-ticket sizes are not viable for doing business on e-commerce. Besides, they also claimed the online platform has increased commission for some items if they are priced above Rs 300, thus forcing them to sell at a lower price.

In June 2016, Flipkart initiated the policy change towards third-party sellers, charging higher commission rates in key categories, passing on costs of product returns to sellers and encouraging them to use its logistics service, as part of an effort to improve its customer service and brand.

In March this year, the e-tailer reduced ‘fixed fee’ by Rs 5-10 for small value items but it increased the same by Rs 10 for products priced above Rs 1,000.

During late last year, Flipkart offered a range of incentives to merchants who sell the most on its platform as India’s largest online retailer looks to make them partners in a mission to improve customer experience in search of what it termed as better business growth.

“We started a marketplace turnaround last March. We had to fix a lot of things for sellers when our net promoter score (NPS) was at an all-time low. We took up several initiatives which resulted in an increase of NPS in terms of seller satisfaction has grown to 70 from 45 last year. Product returns have come down by 15-20% since last year, while cancellations have fallen by half,” said Goteti.



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