Kishore Biyani, known to have spearheaded organised retail in the country, had come down heavily on home-grown e-commerce companies, especially India’s largest online marketplace Flipkart, a few days ago for giving discounts, “disrupting” the market and hurting the business of physical retailers. But Biyani seems to have done a volte-face by entering into a partnership with Amazon India.
Future Group that runs retail chains such as Big Bazaar, Food Bazaar and Foodhall will sell its privately-owned apparel brands through Amazon India to start with, and then extend to other categories. The company has over 40 brands, including Indigo Nation, Scullers and Jealous21.
“Partnership with Amazon, which obsesses to be earth’s most customer-centric company, will enable us to leverage their strengths, investments, and innovations in technology to reach out to a wider set of consumers across India,” Biyani said in a statement.
This is Future Group’s third major online initiative after the launch of its Futurebazaar.com and Future Direct, both of which have failed to attract Indian consumers so far.
Industry experts feel this could be a significant development for Future Group to reach out to consumers in small towns, where the company is not present, and also a way to gain more visibility and traction for its private-brands, which make up over 60 per cent of its overall sales as it is a high margin business.
“Physical retailers are realising the fact that e-commerce is the future of retail in India and, hence, are looking at intelligent tie-ups and ways to expand their business, while competing with their peers and the ecommerce players,” said Arvind Singhal, Chairman of retail consultancy firm Technopak Advisory.
Recently, Tata Group’s Tata Housing and electronics consumer durable chain Croma ‘exclusively’ tied up with Snapdeal. However, Croma also sells on eBay and its products are available on Amazon.
Meanwhile, retail experts feel Amazon.in would be able to directly take on Flipkart by strengthening its fashion segment through Future Group’s partnership. There are also reports that Amazon is looking at acquiring fashion portal Jabong.