Domestic e-commerce companies may run into more competition in the months ahead with global entities such as Alibaba, Rakuten and Walmart seriously eyeing the Indian market.
Founded by two ex-Amazon employees Sachin and Binny Bansal, Flipkart has been changing its formats and strategy over the last year with Amazon’s entry.
China’s largest e-commerce company, Alibaba.com, and Japan’s online market place Rakuten are likely to enter the $12-billion (including online travel portals) e-commerce space in the next 6-8 months.
Rakuten, which also runs a travel portal along with its other e-tailing services, is understood to have already leased out an office space in Bangalore, the e-commerce hub of India.
Bangalore is home to large players such as Flipkart, Myntra and Amazon, among others.
Founded by Hiroshi Mikitani in 1997, Rakuten runs portals such as Rakuten Global Market, Rakuten Coupons and TicketStar, among others.
Re-entry for AlibabaWhile the Tokyo-based company will be entering India for the first time, for Jack Ma’s Alibaba, it will be a re-entry, with a changed strategy and format. Alibaba, which had successfully ousted global giant Amazon from China, used to run a business-to-business channel in India. It is said to be planning the launch of a business-to-consumer platform soon.
Rakuten and Alibaba could not be contacted for this report.
Meanwhile, Walmart, the world’s largest big-box retailer, recently announced plans to open 50 more wholesale outlets in India and start online operations for small businesses.
The American giant’s e-commerce service will be available only to its trader-members and not to general consumers. However, experts believe that the company might look at launching a B2C service, in case foreign investment is permitted in the sector.
Arvind Singhal, Chairman of retail consultancy Technopak Advisory, said the entry of global players will give an additional fillip to the sector by bringing in further investments, apart from making the market competitive.
More jobsAccording to analysts, the e-commerce sector alone is expected to create more than 80,000-100,000 jobs this year.
Ashish Jhalani, founder of consulting firm e-Tailing India, said the entry of international companies will also witness a race among companies to acquire more sellers. The focus would be on expanding their exclusive seller base.