According to regulatory filings, Amazon has committed more money to grow its wholesale business in India and has infused a fresh capital of 115 crore in the unit. The new investment will take the total capital raised by the wholesale unit to Rs 155 crore.
The Seattle-based company’s wholesale arm -Amazon Wholesale (India) -set up in 2013, runs the company’s business (B2B) portal and also acts as a distributor of exclusive products like smartphones to merchants on its online marketplace Amazon India.
Amazon moves comes at a time when China’s Alibaba is aggressively growing its B2B offering in India. The company last week announced a slew of tie-ups including with banks like Kotak Mahindra Bank and IDFC Bank besides logistics firms like Delhivery and DHL.
The company, over the last three years, has strengthened its foothold in Indian market giving a tough competition to home-grown e-tailers such as Flipkart and Snapdeal. According to a recent reports by a Bank of America Merrill Lynch, the American e-commerce giant could be the second biggest player after Flipkart in the online retail market by 2019.
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India could also become Amazon’s second largest market (after the US) as it plans to invest $5 billion in its India business, the report said.
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Over the last one year, the company has launched various services to pull custoemers. In July this year, the company launched its prime subscription service, Amazon Prim in India. The members of Amazon prime would get guaranteed 1 or 2-day delivery for their purchases on Amazon. There are no limits on the number of fast deliveries a customer can avail.
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The company has also recently announced the launch of its Pantry services in Hyderabad, where customers can shop for over 4,000 everyday essentials. Amazon Pantry makes it convenient for customers to stock-up for a basket of frequently purchased items while also increasing savings when compared to shopping at supermarkets.
Now the wholesale arm, which currently serves small and medium sized business (SMBs) in just Bengaluru and Mangaluru, lists office products, stationery, housekeeping supplies, kitchen, health, personal care, food and beverages.
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According to a Walmart report in 2014, India’s B2B ecommerce industry will grow to $700 billion by 2020 from $300 billion in that year. This is certainly much larger than the consumer facing ecommerce industry, which is estimated to reach $103 billion by 2020 including online retail and travel, according to Goldman Sachs.
