Flipkart has acquired a 100% interest in Walmart India, which operates the Best Price cash-and-carry business to strengthen capabilities and business-to-business service offering. With the acquisition, Walmart India’s employees will join the Flipkart Group, and the home office teams will integrate over the next year.
In addition, Flipkart Group has also announced the launch of Flipkart Wholesale, a new digital marketplace that will help transform the kirana retail ecosystem in India. Adarsh Menon, Senior Vice President and Head of Flipkart Wholesale said that the firm will leverage the synergies between the two group by staying focused on transforming the wholesale experience for kiranas and MSMEs
The Best Price brand will continue to serve its over 1.5 million members via its omnichannel network of 28 stores and e-commerce operations, said a press release by Flipkart. The company also operates 2 fulfilment centres in India – Lucknow and Hyderabad.
According to a Flipkart employee, present at the town hall meeting, the wholesale business will launch with a separate app focused on Kirana customers in August to be headed by Menon. The firm will initially pilot services for the grocery and fashion categories.
Sameer Aggarwal, Chief Executive Officer at Walmart India, will remain with the company to ensure a smooth transition, after which time he will move to another role within Walmart.
The acquisition of Walmart India business will strengthen Flipkart’s positioning in B2B. The Bengaluru-based company has been testing B2B waters for the past 6-8 months with a pilot in Delhi NCR region. It will also open a new front for Flipkart where the form would compete with Metro, Reliance Market including Tencent-backed Udaan and Amazon, among others.
The emphasis on kirana in Flipkart’s press release hints that it’s in urgency to woo small retailers who have been adopting Jio Mart’s platform at a quick pace. The Mukesh Ambani-led firm already crossed 2.5 lakh orders a day, and it would soon pass the largest e-grocer BigBasket’s volume.
Despite Flipkart taking several attempts at the grocery, it wasn’t able to gain any grounds in the sector. This acquisition is likely to help Flipkart to plug into the grocery ecosystem holistically.
Last week, Flipkart Group had received a fund infusion of $1.2 billion led by Walmart, along with a group of existing shareholders. The investment values the company at $24.9 billion in post-money valuation.