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Flipkart May Acquire Walmart’s B2B Stores To Boost Grocery Segment

Flipkart May Acquire Walmart’s B2B Stores To Boost Grocery Segment

This will strengthen Flipkart’s plans to enter the grocery delivery market

Flipkart is running a pilot of FarmerMart in Hyderabad

Flipkart also invested in agritech Ninjacart this month

After talks with Tata Group reportedly did not make any headway, ecommerce giant Flipkart Group might acquire Walmart’s loss-making B2B wholesale store, Best Price Modern Wholesale. This development comes at a time when Flipkart is looking to expand into the online food and grocery segment with FarmerMart.

As per an ET report, the reverse acquisition will help Flipkart to expand its footprint in the food and grocery segment and strengthen its supply chain in India. Moreover, Flipkart will also share Walmart’s warehouse, which will help in fulfilling grocery orders for the company. Walmart acquired Flipkart in 2018 for $16 Bn and currently, it has 28 Best Price stores in India.

All That Went Into FarmerMart

Flipkart is currently running a pilot for FarmerMart in Hyderabad. It has also partnered with agritech startup WayCool Foods and Products, along with other sellers to make the pilot a success. WayCool provides an omnichannel platform for the distribution of fresh fruits and vegetables to local shops and modern retail outlets.

Moreover, both Flipkart and its parent Walmart have also committed to investing in another agritech Ninjacart. In December 2019, both the companies announced their strategic investments in Ninjacart.

A month after that Flipkart invested INR 71.83 Cr ($10 Mn) in Ninjacart’s Series C round, along with Singapore-based GEC3. According to the Ministry of Corporate Affairs fillings of January 11, accessed by Inc42, Flipkart and GEC3 each have bought 1,175 Series C compulsorily convertible preference shares (CCPS) in Ninjacart for INR 35.73 Cr.

Moreover, Flipkart has also invested $60 Mn in the logistics startup Shadowfax as a part of its Series D funding round. Shadowfax currently handles 10Mn monthly shipments across several segments — food delivery, groceries, ecommerce orders for fashion, electronics and other categories.

By investing in Shadowfax, Flipkart is hoping to add an extension to its existing logistics partnerships. In a previous press statement, the company also added that it would leverage Shadowfax’s network of sustainable hyperlocal logistics to bring Kirana stores and other retail outlets onto its online marketplace.

The Grocery Delivery Market Is Heating Up

Besides Flipkart, even Amazon and Reliance have entered the grocery delivery platform. Amazon’s Prime Now currently delivers to all the pin codes in the country, Amazon India’s head Amit Agarwal said in December 2019.

Amazon’s Prime Now grocery delivery had started off with operations in 10 cities. Moreover, the platform is also looking to enhance its logistics to deliver fresh produce within two hours with the support from Future Group-owned Indian retail chain Big Bazaar.

Reliance Jio’s JioMart services have also gone live in three locations — Navi Mumbai, Kalyan and Thane. The company eventually plans to scale its operations to a national level soon. Moreover, JioMart is also planning to launch a grocery store network across the country.