Flipkart acquires Walmart India; announces launch of 'Flipkart Wholesale' in B2B foray

Flipkart on Thursday anunced acquisition of Walmart India for an undisclosed amount, and said it will launch 'Flipkart Wholesale' next month, as homegrown e-commerce major looks to tap into USD 650 billion B2B retail market in India. Walmart India runs 28 Best Price wholesale stores in country.

anuncement comes a week after Flipkart h said it h raised USD 1.2 billion in funding from a Walmart-led investor group. In 2018, Walmart Inc h invested USD 16 billion for acquiring 77 per cent stake in group. Flipkart Wholesale is a new digital marketplace focusing on dressing business-to-business (B2B) segment in India.

“This marketplace is going to effectively link sellers and manufacturers on one end and kiranas and micro, small and medium enterprises (MSMEs) on or end,” Flipkart Senior Vice President and He - Flipkart Wholesale arsh Men told PTI.

acquisition will help strengn capabilities to dress requirements of kirana and MSMEs, he said. move will furr intensify competition with Flipkart's rival Amazon that has a similar offering for B2B segment.

" B2B market for finished goods is estimated to be worth USD 650 billion. To start with, we will be focusing on USD 140 billion of that USD 650 billion, which is largely categories of fashion, grocery, general merchandise, large and small electronics," Men said.

Walmart, world's biggest retailer, h entered India through a partnership with Bharti Enterprises for a cash-and-carry business that allows small businesses, kirana stores and hotels to buy in bulk. In 2013, two companies went separate ways and Walmart continued to scale cash-and-carry business in India on its own. Flipkart Wholesale will launch its operations in August, and will be heed by Men.

Sameer Aggarwal, Chief Executive Officer at Walmart India, will remain with company to ensure a smooth transition, after which he will move to ar role within Walmart. Employees of Walmart India business will join Flipkart Group and home office teams will integrate over next year, companies said in a statement. Walmart India was a wholly-owned subsidiary of Walmart Inc, and is estimated to have about 3,500 employees.

Best Price cash-and-carry business will continue to serve its over 1.5 million members via its omnichannel network of 28 stores in nine states and e-commerce operations. Walmart India has a new cash-and-carry store coming up in Tirupati in next few months.

"A thing we saw through COVID-19 (outbreak) was kiranas are shopping in more omnichannel ways than before. In our Best Price business, we h a 4X increase in e-commerce within our business, which is primarily brick and mortar. What that tells us is that kiranas are very open to shopping both online and offline," Walmart India CEO Sameer Aggarwal said.

He ded that kiranas will remain big, and organised B2B will account for a bigger part of retail.

"...Within that, online will get a disproportionate share of growth. capabilities are complimentary. This move recognises critical role that kiranas and MSMEs play towards India's ecomic prosperity and growth," he said.

se businesses will have one-stop access to an extensive selection of products with attractive schemes and incentives, supplemented with data-driven recommendations for stock selection, delivered through a fast and reliable network to drive greater efficiencies and better margins, Men said.

Kiranas and MSMEs will also benefit from access to easy credit options and opportunities for new income generation through various Flipkart initiatives, creating new ways to catalyse growth, he ded. At same time, partners will benefit from broer reach across country, micro-market insights to enable effective inventory planning and new product development, and cost-effective distribution. Meanwhile, Walmart Inc continues to operate a separate techlogy unit in country under Walmart Labs India.