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FlipKart.com the Indian Unicorn-The publication boy of the Indian StartUp Ecosystem, is the focal point of consideration in everybody’s living room at the time of shopping for precious ones. While shopping and plundering the various rebate offered by the e-commerce goliath numerous a times people think about how on earth does FlipKart profit? Does Flipkart even profit?
What is the Business Model of FlipKart ? To what extent would FlipKart keep on giving rebates to bait clients in? Here is a complete examination of the E-Commerce Giants Business Model for the yearning students.
ABOUT FLIPKART, FACTS, FOUNDERS, FUNDERS AND FUNDING
Before we proceed onward to the Business Model of Flipkart or on how does FlipKart profit, here are couple of things you should think about FlipKart:
In spite of the conviction that FlipKart today is an Indian Company, This is not genuine any longer. Flipkart.com is the name of the site claimed by FlipKart Internet Pvt. Ltd. (Purchased over from FlipKart Online Services Pvt. Ltd.) which thus is possessed by FlipKart Pvt. Ltd, Singapore Yes it now headquartered in Singapore. This Singapore based organization claims greater part of other
organizations and is a mind boggling structure of numerous elements between held by different organizations at last claimed by FlipKart Pvt. Ltd. Singapore (This structure is canvassed at the base in detail). FlipKart is basically an E-Commerce ; organization offering a wide assortment of merchandise from ear-telephones to top of the line shopper gadgets and everything in the middle of the two.
Funding received by FlipKart: Appx 3.5 Billion USD. (as of Janurary 2016, Excluding the Credit Line from ICICI Bank of 450 Cr ;
FlipKart Founders: Founded in 2008 by Sachin Bansal and Binny Bansal (Both Ex-Amazon.com Employees).
Valuation of FlipKart as in Jan 2016: 15 Billion USD (Larger than BigBazaar) as of late Morgan Stanley downsized FlipKart’s
Estimation of offers held by them by 25% i.e. Descending Final Valuation of around 11.25 Billion USD.
BUSINESS MODEL OF FLIPKART (FLIPKART.COM WEBSITE)
How Does FlipKart function: Flipkart is a web based business entrance, B2C shopping Portal, for Indian clients or right now,
customers requesting the products for delivering in India. The model here is : Portal > List Sellers who offer the coveted portfolioitems > Get clients perusing through the items > Create engaging rebates > Customer Shops for the coveteditems > Seller/Flipkart ships the item to client > Product Accepted and Not returned back > Seller gets his concurredcost of the item less the commission charged by FlipKart for doing all that they do. In this way the center bread and spreadof the Model is “X% commission on the aggregate deal esteem given to the merchant”The deal can happen by means of different channels as recorded underneath & For all the deal accomplished by FlipKart for a specific dealer
FlipKart will charge a rate (%) cut on the aggregate deal sum barring charges.
Coordinate through Website
Coordinate through Web-App
Coordinate through Mobile App (Android or iOS or others)
Coordinate through Tele Sales (Customer calling and Placing request – Happens once in a while now)
Through Affiliate systems (Bloggers, Coupon Websites, Review Websites and so forth)
The rate commission changes on the sort of item and the kind of offer that FlipKart makes. It might run anyplacebetween 5% to 20% of the deal esteem (barring charges and rebates). The accompanying is an e.g. of how the charging of FlipKart deal will be recorded in FlipKart’s money related books:
Customer A, B & C Purchase 5 Products from FlipKart in a month and these items are a Book, a Stereo, A Fridge, A Cell Phone and a Bed sheet from 3 Sellers. Receipt for the Month for FlipKart looks like underneath table
The aggregate of Col I will be the aggregate income of FlipKart from that specific deal, now the numbers here are little and are taken for the simplicity of estimation in actuals these numbers are heavy and keep running into billions of dollars (Ref: Total Loss of Flipkart for FY 14-15 was around 2000 Cr). This is the fundamental bread and margarine for FlipKart. There are other Revenue and Business Lines also that FlipKart has. These are sketched out and clarified in points of interest underneath.
You may likewise be Interested in Reading Alibaba Business Model
Business Model of FlipKart (Company as a Whole)
Presently as I specified before in the above area that FlipKart is not an Indian Regulated organization any more, it is enrolled in Singapore and has numerous more backups to do related organizations to expand and derisk its income demonstrate from those of the contenders. Following are the different income lines that FlipKart has for extra sources (united to its center business) of income:
Web Portal (E-Commerce : Highlighted Above so not getting into the profundity of this)
Online interface Listing Fee and Convenience Fee (Sellers charged posting expense for offering on FlipKart and Customers charged Accommodation Fee for speedier Delivery)
Logistics (FlipKart Logistics Pvt Ltd Singapore – To dispatch results of merchants)
FlipKart Digital Media (Selling Ads (to dealers and brands) and other related items like co-marking and co-publicizing)
Myntra (Competing with its own particular online mold class yet a major lift to the general online form for FlipKart)
FlipKart Cash and Carry (FlipKart’s discount division)
Item Launch (Unofficial – I think they do charge individuals to dispatch an item on their MarketPlace)
PhonePe – Mobile Wallet on the Lines of PayTM and others. [Launched as of August 2016].
Business model of FlipKart from Listing and Convenience Fee
FlipKart may begin charging (or may as of now be charging) a posting expense for the venders to have the capacity to offer on its stage, which in the end indicates the aggregate income of the organization. Additionally the accommodation charge charged to clients for blessing wrapping, quicker conveyance signify the aggregate income of the online interface.
Business model of FlipKart Payment Gateway – PayZippy
You may also be Interested in Reading Uber Busienss Model
PayZippy is an installment passage quite recently like some other of the 1000’s of installment portals out there and gives administration to FlipKart and any semblance of other E-Commerce players out there. The plan of action is quite basic they charge an exchange preparing sum to each exchange that experiences their installment passage foundation. I will give a review of the different methods of installments here. Essentially exchange preparing charges contrast from mode to mode like it is most reduced in Debit Card and Net Banking (around 0.75% to 1.00%) of the exchange sum. Mastercard (1.5% to 2.25%), American Express Cards(3.00% to 3.50%) – So relying upon the mode that the client chose to make the installment the internet business organization will get an sum in the wake of holding the exchange preparing charges e.g. I purchase a Book for 1000 INR and pay utilizing AMEX Cards through PayZippy the offering online business entrance from where I purchased the same would get 965.65 (1000 * (1-3%*(1+14.5% ST))). Also,thus for other installment modes the exchange preparing charge will be held by installment entryway.
Busienss model of FlipKart Logistics
Prior EKart Logistics used to only convey FlipKart Sellers and requested items, later on it got spun off (expelled from FlipKart) as an alternate substance that now dispatches for all stages. Coordinations organization charges merchants as other dispatch organizations to convey their products to those clients who have requested the same from an E-Commerce Player. Charges are level contingent upon inside city or between city or size of the bundle.
Business Model of FlipKart Digital Media
FlipKart offers three sorts of Ads as takes after:Co-Branded Banner Opportunities on Home Page: The Slider that you see on landing page of FlipKart presents chances to heaps of dealers, brands and item launchers to introduce themselves to the a huge number of online visits that FlipKart produced consistently. This is for a good looking charge that FlipKart considers the aggregate income. (Picture Source FlipKart.com)
Co-Advertised Physical Product crosswise over Publications: The substantial promotions that you find in daily papers and front pages of the magazines (assuming any) are imparted to the brand that they are publicizing. For e.g. In the event that it’s another telephone that is being propelled and FlipKart hits the daily papers with a front page advertisement (the cost of promotion is imparted to the next brand that is publicizing the item).
Targetted Search Results: The minute you scan for an item, FlipKart’s calculation chooses which dealers items come at the best. This space can be sold by FlipKart for extra income (I don’t know whether they are doing this starting at now, yet they will as news proposes)
The investigation of the Business model of FlipKart or How does FlipKart Make Money is of the Author’s himself, neither the organization (FlipKart) or its members have affirmed the same to the creator and the depictions, details, statistical data points are either acquired through optional web research or cross examination of the clients/merchants or different assets on the web. It would be ideal if you utilize your own particular caution to utilize this information when required and by proceeding to peruse you consent to repay the creator from all risk emerging out of utilizing this data all alone.
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