In a daring move to acquire, Indian e-commerce website, Flipkart took over 100% of Walmart India to establish Flipkart Wholesale, a new digital marketplace designed to help transform the local retail ecosystem in the country. It is also stated that this initiative will cater to local fashion needs, along with grocery demands.
Walmart India has special wholesale, retail abilities that can effectively cater to the Indian market, called the Best Price cash-and-carry business.
Flipkart veteran Adarsh Menon will head the operations for Flipkart Wholesale, which will begin operations from August this year. Sameer Aggarwal, Chief Executive Officer at Walmart India, will remain with the company to ensure a smooth transition, after which time he will move to another role within Walmart, Flipkart said.
Walmart’s Best Price is a premier supplier for local grocery stores (kiranas), and hence has a diverse, interconnected web of vendors at its disposal, including more than 1.5 million members through 28 stores and e-commerce operations.
“For over a decade, we’ve been committed to India’s prosperity by serving kiranas and MSMEs, supporting smallholder farmers and building global sourcing and technology hubs throughout the country“, said Judith McKenna, President, and CEO, Walmart International.
Will this move be beneficial to local businesses, kiranas, and other MSMEs, or will Flipkart Wholesale take over their customer market by becoming a vendor? The latter is unlikely because Flipkart has promised growth to local vendors, which means that Flipkart Wholesale will keep the role of the supplier in the gigantic ration-grocery market of India it is going to be a B2B retail operation.
“The acquisition of Walmart India adds a strong talent pool with deep expertise in the wholesale business that will strengthen our position to address the needs of kiranas and MSMEs uniquely,” said Kalyan Krishnamurthy, Chief Executive Officer, Flipkart Group.
What makes this acquisition interesting is that Walmart had acquired Flipkart in the recent past. Now, Flipkart turned that incident on its head by acquiring 100% of Walmart India. Keep in mind; the Indian B2B retail market is worth USD 650 bn.
Flipkart Wholesale has a humongous market to satisfy, and with Walmart India’s resources, it will only lead to better days for everyone.