While Walmart is on its way to seeking the nod of the Competition Commission of India (CCI) for its stake in Flipkart, the Indian ecommerce giant continues to focus on its day-to-day activities and customer satisfaction.
After Flipkart CEO Kalyan Krishnamurthy asked Flipkart employees to continue delivering, now the company has introduced checks and balances for its sellers to audit product quality so that it can reduce its return rate from customers due to poor quality products.
According to an ET report, Flipkart sent an email to its sellers stating that if they fail to pass the audit, they could be delisted or they might even lose the ‘Flipkart Assured’ badge on the platform.
The company said in the email, “In case 70% or more of your product samples do not pass the audit, the audit will be considered a failure.”
If the seller fails in the first audit, his products in the vertical will be delisted from the platform for a week and a second audit will be conducted within 15 days.
Further, if the products fail the second audit, the products of the brand in the vertical will be completely delisted.
An email query sent to Flipkart didn’t elicit any response till the time of publication.
The report added that this programme is a part of Flipkart’s latest initiative, Flipkart Utkarsh, with which the company aims to help sellers improve businesses with a focus on operations and product quality.
Anil Goteti, vice-president and head of marketplace, Flipkart, told ET, “Our team will visit various seller locations to help identify possible gaps in the quality of the products they sell on Flipkart. We are using artificial intelligence and machine learning to form these guidelines. It uses data from both the sellers and customers and gives us an insight into areas that can be improved to reduce returns even further.”
This comes in the light of Flipkart’s aim to reduce returns by 10-15% in the next 12 months by improving product quality and thus, increase sales in the company. It is also looking to turn profitable in the coming years.
In the Indian ecommerce market, returns are as high as 30% and the industry has been dealing with high return rate which leads to heavy losses in revenue for sellers as well as the ecommerce company.
In a report, RedSeer Consulting noted that the industry was dominated by “high returns and cancellations with the difference between shipped and fulfilled gross merchandise value being as high as more than 30%.”
It added that fashion category has the highest cancellations and returns while mobile and appliances have the least. “We feel the industry needs to focus on ensuring the right products get delivered as 30% is a good amount of revenue to be lost,” said a RedSeer report.