Founded in 2007 by Sachin Bansal and Binny Bansal, who share the same surname but are not related, Flipkart’s business model relies on scale, which reduces operating costs. In its first seven years, Flipkart’s workforce quickly expanded to 14,000 people, proving that e-commerce has a huge market potential in India.
As the company continued to grow, Flipkant wanted to improve its service and control the customer’s shopping experience from beginning to end, making the shopping process seamless and reliable, in order to differentiate itself from its competitors. This is very similar to what JD.com does in the Chinese market.
Sachin and Binny had a reason to do this. India’s postal service is notorious for frequently losing packages, so most Indians send things by registered mail to ensure that someone is responsible for the package. There are many express delivery companies in India, but their services, such as delivery speed and reliability, are simply not comparable to those of UPS, FedEx or DHL.
So Flipkart began to build a large amount of logistics and delivery infrastructure, and also formed a team of motorcycle delivery teams, which were affixed with yellow “FLIPKART” logos and shuttled through the streets and alleys of India. They can not only deliver express delivery, but also transport returned products back to the warehouse, and the most feared issue for Indian logistics companies is the return of goods. Delivery motorcycles can also accept cash payments when delivering express parcels. It turns out that this is exactly the major breakthrough that Indian e-commerce needs.
Today, Fipkart is already the No. 1 in the local e-commerce market in India, and in the minds of Indians, Flipkart has become the preferred shopping website.
In August 2018, Walmart announced the completion of its acquisition of Flipkart for $16 billion, which is the largest M&A transaction in the history of the Indian startup ecosystem. With the support of Walmart, Flipkart is leading Indian e-commerce to the center of global e-commerce.