Flipkart Pvt Ltd.docx

Flipkart Pvt Ltd. is an Indian electronic commerce company based in Bengaluru, India. Flipkart founded by Sachin & Binny bansal in 2007, the company initially focused on book sales, before expanding into other product categories such as consumer electronics, fashion, and lifestyle products. As of March 2017, Flipkart held a 39.5% market share of India's e-commerce industry. Flipkart is significantly dominant in the sale of apparel and was described as being "neck and neck" with Amazon in the sale of electronics and mobile phones. Flipkart also owns PhonePe, a mobile payments service based on the Unified Payments Interface (UPI).

Walmart Inc. is an American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. The company was founded by Sam Walton in 1962 and incorporated on October 31, 1969. As of January 31, 2019, Walmart has 11,348 stores and clubs in 27 countries, operating under 55 different names. Walmart’s global organizational size gives the business deep pockets to fund growth and expansion. Walmart’s supply chain has high efficiency because of advanced technologies for monitoring and controlling the movement of products from suppliers to its stores.

COLLABORATION OF FLIPKART AND WALMART In August 2018, U.S.-based retail chain Walmart acquired a 77% controlling stake in Flipkart for US$16 billion, valuing it at $22 billion. For Flipkart, this is a strategic sellout while for Walmart, this is a long-awaited entry into retail in India, after succeeding in other Asian markets like China and Japan. After having established itself as the world’s largest retailer, Walmart wants to bite a chunk of the Indian retail market worth $670 billion. Holding

Flipkart’s hands, Walmart will surely expand the ecommerce market in India. Of course, there is the undeniable effect of Amazon, the only company which has posed a strong rivalry to Walmart in the US and Flipkart in India. But this new alliance does more than fight Amazon, which has got 35 percent market share in India in five years. Flipkart has a lot to learn from Walmart in terms of work culture and operations, while Walmart – being the veteran that it is can take a leaf or two out of Flipkart’s book in innovation. Flipkart’s extravagance and Walmart’s frugality Walmart’s key is to offering low prices to the customers. In fact, their Every-Day-Low-Pricing (EDLP) strategy is a result of efficient methods in sourcing, supply chain, and front-end operations. While Flipkart likes its luxuries, be it swanky offices or pay packages to fresh graduates. In India, the next 100 million customers to come online will be the middle class, who check price labels before buying and Flipkart will definitely benefit greatly by following conservative minded Walmart’s dictum. Flipkart’s advantage in operations The Walmart deal will give Flipkart access to international markets. To penetrate deeper into different markets the homegrown ecommerce unicorn will need deep pockets like Amazon – exactly what Walmart brings in. To build loyalty among customers, they need to shift focus to beauty, grocery, personal care items, furniture, etc. on which Walmart can do a lot. Currently Flipkart has no expertise for running offline. But Walmart is already offline and can open physical retail in India with Flipkart brand stores in the long term. What Walmart gains from Flipkart For Walmart, it is a move into another large market. With the Flipkart deal, Walmart is in a position to get on a higher ground as

they have a stake in the biggest ecommerce company in India. It never has had an online presence and it knows that to take on Amazon it has to get a strong online presence. Walmart is slow paced, and needs new generation leaders like Flipkart, which encourages entrepreneurial culture, to boost their online presence in India. Flipkart tech and service are efficient and they are a powerful business while Walmart does not have direct retail experience in India.