Private labels to help Flipkart light up Big Billion & diversify

Editor | Sep 10, 2020

With the stress of raising funds put behind, cash-rich Flipkart is now concentrating on its next move. The etailer has zeroed down on private labels as its ammo for its next phase of growth.

Private brands to dominate product portfolio during Big Billion

Flipkart plans to expand its own brand ‘SmartBuy’ and launch a host of product categories under it. As of now, the etailer’s SmartBuy brand exists in 15 product categories. Their aim is to spread it over 35 product categories by July or August. Just in time for Big Billion 2017 edition.

Speaking about their strategy, Adarsh Menon, VP & Head – Private Labels at Flipkart stated, “In the second growth phase for SmartBuy, we have introduced small kitchen appliances, trimmers, dryers and straighteners in the personal care category. We want SmartBuy

to be an umbrella brand across all daily-use categories.”

“The idea is to launch everything before the festive season begins, before Big Billion Day (BBD)—because it is a fantastic platform for us to present the entire range to all of India,” Menon said.

Sourcing products from across the world

As far as sourcing inventory for its private label is concerned, Flipkart is not restricting itself to any country or supplier. The etailer insists that seriousness about doing the business matters the most as good quality products in affordable prices are what SmartBuy aims to sell.

“Some of our sourcing is from China, some from India. We will source furniture from Malaysia. We are unconcerned about the location but uncompromising about working with suppliers who are as serious about their products as we are,” asserted Menon.

Flipkart relies on sellers to retail its brand under licensing agreement post-launch of a new category. Vendors who have earned the ‘Flipkart Assured’ badge could get their hands on the inventory. And it does seem like a wonderful opportunity for sellers to bag exclusive selling rights of SmartBuy products because it is one of the top selling brands.

Menon affirmed, “Sellers retailing the SmartBuy brand are starting to see additional 500 basis points in profits across categories. In terms of share across categories, SmartBuy is the largest or among the top four brands. In chargers, we have 50% share; in fans, we have 35%. In branded categories, we are at 860%.”

Diminish reliance on smartphone sales

Another goal that Flipkart aims to achieve by expanding Smartbuy is reducing reliance on its fastest selling product category – smartphones.

Be it their annual Big Billion Days sale or any other festive sales, mobile phones fly off Flipkart’s shelf within hours. It also accounts for the majority of the revenue generated across the year. But Flipkart wants to move away from this one category and increase revenue across all categories. And the company hopes that SmartBuy would allow them to achieve that.

Between high sales volume and high-profit margins, Flipkart is choosing the latter by focusing on private labels. Would it pay off and lead to profitability?

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