Flipkart Rejects Chinese Charm, Opts For Make in India Products For Future Expansion in India!
Seth Godin, the Marketer, often tells that competition on price is often a race to the bottom.
In June this year, when news came in that Flipkart is following the Paytm way to source cheap Chinese products and then sell to Indians, the genuine ecommerce lover was concerned. Sourcing dirt cheap Chinese products meant that Indian manufacturers and inventors would be at a losing end.
Fortunately, Flipkart’s rendezvous with Chinese products has almost ended, as they have decided to embrace Make in India vision with full force. As per reports coming in from various sources, Flipkart is all set to re-introduce private label products, made by Indians, in a new avatar, and create some ripples across the industry.
Ecommerce analysts are comparing this recent program by Flipkart to their 2011 era ‘cash on delivery’ program, which literally reshaped the industry.
Why Make In India Makes Sense For Flipkart?
At a time when leading Chinese, American, Japanese and European firms are making a beeline for launching their own ‘Make in India’ units in India, it makes perfect sense for Flipkart to embrace the same ideology and create some dent in the market.
Besides, choosing ‘Make in India’ centric pitch will help Flipkart to differentiate themselves from Amazon and Alibaba, which are mainly sourcing products from all over the world, rather than choosing one particular country.
And Centre’s push and preference for Make in India products will certainly put Flipkart in the good books, and maybe help them to sort out their income tax issues as well. One of the people close to Flipkart’s new avatar in the form of ‘Make in India’ said, “the subsidies and tax benefits for make-in-India products and the favourable government attention make the opportunity exciting.”
How Will Make in India Work For Flipkart?
As per insider sources, Flipkart has created a strong team which will source several private label products made by Indians, and then sell and market these products rigorously on their platform under the ‘Make in India’ vision.
Although there are more than a lakh merchants on their platform, but these ‘Make in India’ private label products would form the cream of Flipkart’s offerings, because they would be sold under their own brand name.
An insider told that Flipkart has decided to diversify their focus for this special ‘Make in India’ avatar, and will buy private label products ranging from electronics to apparels, furniture and even gadgets.
The inventors, manufacturers of these products would be incubated by Flipkart, and then a team would be formed to make these products large and enable them to sell more.
Clearly, Patanjali is Flipkart’s role model in this mission, as they are very much influenced and impressed by their instant success. Besides, the margins are also massive in selling private label products, and this can be Flipkart’s next big move in the coming days.
Another person close to this team said, “This Make-In-India initiative could be Flipkart’s big play in the broader commerce business as products under the brand will be manufactured in India.”
Can Flipkart’s new avatar of selling ‘Make in India’ products empower them to beat Amazon? How will Alibaba and Paytm counter this move? We will soon find out..