Why Flipkart Wholesale’s expansion focuses only on fashion

B2B e-commerce focused on electronics, kirana and fashion verticals has been gathering significant attention for the past three years. After Udaan, Flipkart and Amazon are ramping up their bets in the segment. While Amazon delivers supplies to 20,000 kirana stores, Flipkart recently introduced Flipkart Wholesale, its procuring platform for mom and pop stores.

Launched in the last week of July, Flipkart Wholesale today announced the extension of its operations to 12 new cities including parts of NCR and Mumbai, Meerut and Chandigarh (tricity). As of now, the platform’s supply would be limited to fashion vertical only. 

It would add categories such as home, kitchen and grocery by the end of the year, a company statement said. The expansion to these cities makes absolute sense for Flipkart as demand for apparels and accessories will be all-time high in the upcoming festive season during October and November. 

“Expanding Flipkart Wholesale with fashion is a good call for Flipkart for two reasons: Firstly, it’s strong in fashion with multiple private labels under Myntra. Secondly, the sales will shoot up in the festive season,” said Satish Meena, senior forecast analyst at Forrester.

At present, Myntra has over 15 private label brands which drive 30% of its overall revenues. Flipkart Wholesale would push these brands through small scale offline stores. This appears to be a good strategy for the wider adoption of in-house brands. 

The platform would also help sellers leverage micro-market level B2B and B2C insights from the Flipkart ecosystem to better understand customer demands specific to their area so that they can buy and sell the right products. 

Fashion has been one of the worst-hit categories during the Covid-19 pandemic. People have avoided buying new clothes since March. 

“As a result, the fashion industry is sitting on a huge unsold inventory. This also includes Myntra’s private labels. Festive season is a good time to clear such inventories. I think this is the reason behind the expansion of Flipkart Wholesale with fashion only,” added Meena.