Flipkart Walmart Deal

Flipkart Walmart Deal ; one of the biggest in Indian ecommerce and startup eco system in recent times which created new billionaires in India. The world’s largest retailer Walmart Inc. finally announced that it had agreed to buy 77% of Flipkart for $16 billion, valuing India’s biggest Internet start-up at $21 billion.

Walmart will own around 77 per cent of the Bengaluru-based company in what is also being seen as the largest buyout for the US firm. The deal is going to shake things up. The world’s biggest retail deal will impact the whole segment, the competitors and the consumers.

Online sellers on Flipkart are doubtful because Walmart can wipe them off. Walmart has a reputation of killing small businesses with ultra-low prices. They fear that Walmart might bring in its own private labels via Flipkart to the Indian consumers, adding to competitive pressures.

The deal completely redraws the e-commerce landscape in India and escalates Walmart’s global battle against Amazon.com Inc., its biggest rival in the US. Several tens of billions of dollars are at stake on both the sides. While this has been a positive outcome for Flipkart and all its stakeholders, the e-commerce landscape in India now is essentially going to be dominated by two American companies.

The Flipkart deal is the most significant acquisition in the history of Walmart. For Walmart, this deal represents a fight for everything it has built over the past five decades and a massive bet on the future of retail. Flipkart will be the centerpiece of Walmart’s global e-commerce ambitions.

The success of Flipkart under the Walmart would depend on how it is able to effectively implement a world-class supply chain in India, given all the challenges in the Indian context. Another big battle that will open up between Walmart and Amazon in India will be in the food and grocery segment. Last year, Amazon received government approval to start to sell locally produced and packaged food items through offline and online channels.

War between an empowered Flipkart and Amazon will shrink the space for smaller players because it will ensure that prices, quality and delivery remain highly competitive.

India’s total consumption is expected to rise to $3.6 trillion in 2027 from $1.3 trillion according to industry data. The retail market is expected to hit $1.8 trillion from $650 billion. Agriculture and infrastructure sectors will get a big boost due to competition between Flipkart and Amazon. Farmers will benefit from increasing demand. It can also boost overall consumer demand.

All its stakeholders including investors, founders and employees. A number of current employees have turned dollar-millionaires overnight. This deal should catch the eye of a number of large, foreign strategic investors who have been eyeing India for a long time. Broader start-up funding is expected to go up

Walmart is expected to use a good part of its investment to build infrastructure including food parks, cold chain and collection centers. Food is already an important part of Walmart’s cash-and-carry business in India, comprising around 60 per cent-65 per cent of sales annually. With the Flipkart buy, we can look forward to more activity on this front from the company. Is it the beginning of serious stabilization in the Indian industry?

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