India’s largest ecommerce brand Flipkart is reportedly in talks with international original equipment manufacturers (OEMs) to collaborate on manufacturing electronic appliances and products for the Indian market. The company is looking to collaborate with Sansui, Nokia and Motorola, to manufacture Smart TVs, which will expand Flipkart’s MarQ brand of electronics and home appliances
While Amazon runs a private label called Amazon Basics to offer electronic products to Indian consumers, Flipkart has launched TVs, washing machines and audio accessories under its MarQ brand. According to a report in Business Standard, the ecommerce company is now in talks with three companies since the last six to eight months.
Talks are said to be in an advanced stage with Nokia and Motorola and Flipkart will manufacture and launch their TV models. In its collaboration with Sansui, Flipkart will launch smaller home appliances such as juicers, grinder and other kitchen appliances. Flipkart denied commenting on the report.
The effort is being led by the company’s MarQ private label team, headed by Adarsh Menon who also heads the electronics and furniture category for Flipkart.
Flipkart is using its network of manufacturers who are already working with the company for its in-house brands MarQ and SmartBuy. Sansui, Nokia and Motorola will co-develop products in collaboration with Flipkart who will build, stock, sell and provide after-sales service for the goods.
Why It Makes Sense For Flipkart To Venture Into Consumer Durables
The Indian ecommerce sector is projected to grow to $200 Bn by 2026 according to projections by India Brand Equity Foundation (IBEF). In the last year, electronics sales was the biggest revenue contributor for ecommerce platforms, accounting for 48% of al sales. IBEF data further added that Indian appliance and consumer electronics (ACE) market is expected to grow at a CAGR of 41% from 2017 to 2020 and reach a size of $400 Bn.
Flipkart Going All Out
With the looming threat of competition coming from Reliance Industries in the ecommerce space, Flipkart is exploring all avenues to expand its footprint in the country.
With the recent launch of Flipkart Supermart in Mumbai, Flipkart entered its fifth market in the grocery space. It recently announced a data centre in Telangana to service the ‘next 500 Mn’ digital consumers in India.
The company is also exploring a hybrid online-offline model with an aim to sell smartphones through 15K convenience stores, beauty salons, bakeries and pharmacies.