With the revision in FDI e-commerce policy in India, Flipkart is encouraging preferred sellers to buy merchandise directly from manufacturers.
Change in policies has lead Flipkart to close the wholesale business.
Flipkart has started curtailing buying products directly from companies to wind its wholesale operations, which have become tougher after rules for e-commerce entities were tightened.
Now it is asking its suppliers to route their products directly to the preferred sellers on its platform, codenamed Alpha sellers, and to wholesale ‘Beta’ sellers — a layer of intermediaries that Flipkart had created to comply with India’s revised foreign investment rules for online marketplaces.
With the introduction of a cap on the amount of goods that an affiliate of the marketplace could supply to an independent seller on the platform, the seller on an e-commerce platform would be considered “controlled” by the marketplace operator if it sourced more than 25% of its merchandise from an entity related to the online marketplace.
By: Pooja Pandita, Staff Writer, DKODING Media