Amazon And Flipkart Tighten Strings To Get Users


Amazon has spent 79% extra in its flagship platform in India as compared to what Flipkart has in its retail marketplace, signifying the Seattle-located e-commerce major’s hostile push to extract leadership of the market in the fastest-developing main economy of the world. Entire spending within Amazon Seller Services up to now is Rs 14,940 Crore, in comparison to Rs 8,349 Crore investment of Flipkart via Flipkart Marketplace, as per their newest regulatory filings carried out in Singapore and India and accessed by the local media. The gap broadened mainly in the last fiscal year.

The Singapore-located parent of online retail behemoth in India, Flipkart Ltd., cut spending into Flipkart Marketplace from Rs 1,629 Crore in the fiscal year 2015–2016 to Rs 27 Lakh in fiscal year 2016–2017 as it aimed on preserving cash in the middle of a funding delay. That pattern has carried on into this fiscal too. Ever since April, Amazon Seller Services has locked Rs 3,300 Crore in new funding while main commerce unit of Flipkart has obtained capital support of less than Rs 2 Crore. This does not comprise funds into Myntra, the fashion unit of Flipkart.

The figures might alter in the present fiscal year. Flipkart insistently cut prices in the current fiscal year as it aimed on capital competence and turning out to be a leaner organization while its valuation worth $15.2 Billion witnessed various markdowns by mutual capital. It now has almost 8,000 Employees, in comparison to almost 15,000 at the starting of last year. But the firm has increased up investment in the last 3–4 Months as it supervised to lift more than $4 Billion from sponsors comprising Japan’s SoftBank Corp. and China’s Tencent. Monthly cash burn rate of Flipkart, which had fell to almost $40 Million at the end of last year, has now ramped to more than $60 Million, as per three analysts and investors.

The rate of cash burn is more for Amazon, which is insistently obtaining new users even if it contains trading low-ticket value user goods. “Amazon is losing minimum 20% more as compared to Flipkart each month,” claimed an insider of the industry.