Big E-commerce companies like Amazon, Flipkart, Alibaba and Google are looking forward to fully utilize the Indian Retail Space in the near future. India is a growing market where there are consumers from all age groups and the major portion is of youngsters. Recently, a report by World Bank also suggested that India is the seventh largest consumer market in the world at present. So, looking at the present conditions, these big companies wish to acquire a strong place in the Indian Retail Space.
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All this has taken a great pace after the recent acquisition of a 77% stake in Flipkart by Walmart. This is the greatest e-commerce deal of the country. After this deal, many of the big firms are looking forward to big investments in India. In the same chain, Recently, Warren Buffett’s Berkshire Hathaway has acquired a small stake in One97 Communications which owns digital payment firm Paytm.
After the Flipkart-Walmart deal, Amazon has been actively involved in conversations with the top Indian retail majors like Kishore Biyanis Future Group; Aditya Birla Group owned food and grocery supermarket chain More, etc. in order to expand its presence in the country. Amazon already has a large customer base in India but for giving strong competition to its rivals like Walmart, Amazon has to partner a brick and mortar company. Because of this, it has initiated talks with RP-Sanjiv Goenka Group-owned Spencers Retail for a small stake and the talks with Future Group and Aditya Birla Group are already going on. So, Amazon is set to acquire a stake in three retailers in India. If all these three deals are finalised, then Amazon will be able to tap more than 1700 stores in India. The company has already acquired a 5 percent stake in retail chain Shoppers Stop. The company is also increasing its technology and has acquired Tapzo for $40 million. Tapzo is a platform that allows its users to access more than 35 apps on a single platform.
Chinese e-commerce company Alibaba is also one of the companies which are eyeing to invest in the Indian retail Space. The Jack Ma led company is in talks with the Tata Group, Kishore Biyanis Future Retail and Mukesh Ambani-led Reliance Industries (RIL) to boost its retail plans in India.
Similarly, Google which was looking to join Walmart in the acquisition of Flipkart is also looking to invest in Indian retail space. Softbank which left Flipkart after the Walmart deal, is also looking at doubling its consumer base in India. Flipkart which is now technically owned by Walmart is also trying hard to compete with its rivals in the country. So India has now become a market where every big company is wishing to invest.
Indias overall retail market is estimated to be at Rs 47 lakh crore. The modern retail and e-commerce together form just about 4%, so there is a plenty of space for organised retail to grow. That is why these companies are competing to utilize the retail space in India in the near future.
Meena of Forrester Research said that even when everyone wants to invest in India but this is happening when online retail is still 2 per cent of the overall retail. She said that it will take time to move customers online from the brick and mortar store. She added that people may buy shoes, mobiles from the online websites but they do not prefer buying grocery from online stores. So the aims of big companies like Amazon, Flipkart, and Alibaba will not be that easy, they will have to do a lot to increase their customers in the country.