With Flipkart’s arsenal getting heavier, Amazon has started pumping in more funds to solidify its Indian operations. Reportedly, the US ecommerce giant has infused another $15.5 Mn in its Indian B2B wholesale marketplace, Amazon Wholesale India Pvt Ltd.
The funds were routed through Amazon Inc. and its Singapore-based subsidiary Amazon Corporate Holdings Pvt. Ltd, as per recent filings made with the Registrar of Companies.
In September 2016, Amazon infused $17 Mn in its Indian wholesale arm to increase the transaction of smartphones via its B2B portal, in compliance with the revised FDI norms. Also, in December 2016, a fresh capital of $23.5 Mn (INR 160 Cr) was injected in its wholesale arm.
Amazon Wholesale (India) Pvt. Ltd was founded in 2013. According to its official website, the B2B arm currently serves small and medium business (SMBs) in Bengaluru and Mangaluru and deals in office products, stationery, household supplies, healthcare products, personal care, food, and beverages. It currently accounts for more than 10,000 sellers in Bengaluru.
No Plans To Back Down
Despite incurring multimillion dollar losses, Amazon is bullish about its expansion in India. Whether its logistics, ecommerce, grocery or digital payments, Amazon is adamant in wanting to maintain pole position
In March 2017, the Indian arm of ecommerce giant managed to secure a licence from the Reserve Bank of India (RBI), to operate a prepaid payment instrument (PPI). To this end, it pumpedin $10.5 Mn in its digital wallet Amazon PayAlso, earlier this month, Amazon announced to double its storage capacity with seven new fulfillment centres.
Prior to that, it was reported that the company had invested in nine dedicated Fulfilment Centres (FCs) and 33 Delivery Stations exclusively for furniture and large appliances. Not only this, in September 2016, Amazon India had also reportedly increased its last-mile delivery network. It now claims to 12,500 local stores and retail outlets in 50 cities.
Furthermore, in December 2016 Amazon had invested a fresh capital of $295 Mn (INR 2,010 Cr) in its main Indian unit. The investment was made in November and marked the total capital invested in Amazon Seller Services to over $1 Bn (INR 7,000 Cr) in the last 12 months, according to regulatory filings.
Touted to be a $64 Bn market by 2021, the Indian ecommerce is engaged in a fierce battle of its times. On one side, there are foreign players like Amazon, Alibaba, which are replying on their billion dollar war chests. While, on the other side there is homegrown crowned king Flipkart which has made consolidating competitive entities its long term survival strategy. While the theory supports ‘survival of the fittest’, how long Amazon will be able to continue dumping money to gain an edge, remains to be seen.