As a part of a strategy to take on Reliance and Walmart-owned Flipkart, Amazon is also looking to foray into offline retail and its stake purchase in Future Coupons last month is a big part of that.
According to the latest report on Amazon’s retail plans, the company is in talks with three retail chains — Future Group, retail chain More and Shoppers Stop— to sell a range of Amazon products offline. Amazon is a stakeholder in all three retail store chains.
Amazon would be starting its offline venture by bringing its AmazonBasics private label and apparel brands Prowl and Just F through a network of 2K stores with these partners. Eventually, it plans to expand the catalogue by including the bestselling products from its marketplace, according to the report in ET.
AmazonBasics is a curious choice to start off with. It’s likely going to increase the visibility of the private brand that was launched in 2015. Exclusively available on Amazon’s ecommerce platform so far, the company sells electronics, home necessities and other general merchandise under the AmazonBasics. These products come with a one-year warranty, which is expected to continue with the offline venture as well.
Amazon is reportedly also planning to venture into groceries, and had acquired Aditya Birla’s retail chain More earlier this year. In September 2018, Witzig Advisory Services through Samara Capital and Amazon agreed to acquire the grocery and retail stores chain More.
Recently, Amazon acquired a 49% stake in Future Coupons, the promoter of departmental store chain Future Retail, in which it has acquired a minority stake of 3.58%. ET reports that this does not include any Amazon private label products in Future’s retail network.
For fashion retail, Amazon has tied up with Shoppers Stop. The fashion retail store chain is likely to display Amazon’s private fashion labels Prowl and Just F in its stores across India.
In May, Shoppers Stop used its subsidiary Shoppersstop.com to relist products on Amazon, after new FDI ecommerce rules had forced the retailer to delist itself from Amazon. In 2017, Amazon had picked up 5% stake in Shoppers Stop, which meant that it couldn’t directly list products, but its online retail unit is a separate business.
Thankfully for Amazon and Shoppers Stop, there’s no regulation on where retail businesses sources their products, so Amazon’s private fashion labels could very well find success in the offline market.