Indian ecommerce leaders Flipkart and Amazon are trying new strategies to woo sellers. One has already declared that it is sellers’ favourite. The other one hopes that pouring more money into seller infrastructure would help them to gain sellers’ trust. Are you wondering who’s who? Read further to know more.
Flipkart believes that sellers prefer them due to low cost
According to the ecommerce unicorn Flipkart, it is the best marketplace is terms of overall cost of doing business for the sellers. That’s why they are sellers’ preferred online selling platform. In other words, Amazon is no longer the most preferred marketplace for sellers, as per the Indian etailer.
In March 2017, Flipkart reduced fixed fees by 30%, forward shipping fees by 10% and COD collection charges by 40%. This helped sellers to bring down the selling cost and make more money.
“When we reduced rate cards, we reduced fixed fee, shipping fee and collection fee and also offered a 10-20% discount for gold and silver (tier I and II category) sellers. Sellers we have interacted with have confirmed our assessment of it (the change affecting on cost of doing business). Gold sellers will be earning a lot more on Flipkart now,” said Nishant Gupta, Head – Marketplace Business, Flipkart.
Back in June 2016, Flipkart had hiked its seller fees considerably, which compelled sellers to leave the platform or phase out gradually.
Although, sellers disagree with Flipkart
Vendors don’t seem to agree with the home-grown firm’s opinion. Even after reducing the fees, selling on Flipkart is still expensive than Amazon, according to sellers.
“They have reduced prices for very few categories and for a specific price range. Even with that, Flipkart was minimum 10-15% costlier than Amazon (before the latter’s fee change. With the current fee revision from Amazon effective from May 18, the marketplace fee deduction of Amazon and Flipkart will be comparable,” said spokesperson of a sellers’ lobby group.
Things might change after Amazon’s revised commission and other fees come into effect from May 2017. But for now, the changes made by Flipkart are marginal.
Amazon’s doubles its budget for seller initiatives
Amazon received a lot of flak for increasing closing fee, FBA fee, cancellation charges, delivery service fee and referral fee. The US-based ecommerce leader is trying to balance out by investing more on seller infrastructure for its India business.
Amazon plans to utilize the money to build warehouses, in-person seller support service, fulfilment centres, seller cafes and other seller on-boarding activities. By doing so the marketplace hopes that its seller network continues to grow.
Pillai shared, “As of March, there has been 160% year-on-year growth in the seller network on Amazon India, with more than 1.75 lakh sellers. This has ensured that on an average, there are 1.8 lakh products for sale in the marketplace at any given time, compared with about 15,000-20,000 products in a brick-and-mortar supermarket.”
Online sellers, which one would you choose – Flipkart’s reduced seller fees or Amazon’s seller initiatives & infrastructure?