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Flipkart-Walmart Deal- Top 3 Reasons How It Can Benefit the End Users

Recently, there has been a lot of anticipation and buzz going around the news that broke out a few days ago –

The world’s largest retailer, Walmart, has acquired Indian e-commerce giant, Flipkart for $16 billion

making this the biggest M&A deal in India this year.

Below, are the few tweets that show how people are not very excited about this news and foresee this acquisition as a big threat.

 

The problem here is that we’re just dealing with one side of the story and that people are mostly having biased opinions towards this acquisition. But, it’s always more advisable to view the two sides of the coin.

Now, of course, this isn’t a new technique, but applying this can, and still does, offer fruitful results/insights.

So, what’s on the other side of the coin?

Can this acquisition in any way give a boost to Flipkart’s current performance or the expectations that online consumers have?

Let’s have a look!

Improvement in Logistics:

Flipkart has always tried to find ways to strengthen its supply chain management with its in-house logistics arm EKart.

But, with the increasing number of Indians getting into the obsession with shopping online, the question has always been-

How will Flipkart gonna keep up the pace of delivering products with faster speed and higher accuracy, something that has always been the strength of Amazon?

Walmart, on the other hand, has arguably had the highest sales per square foot and inventory turnover for the past ten years.

Need Proof?

Walmart, at any given time, operates more than 11,000 stores in 27 countries around the world and manages an average of $32 billion in inventory.

So, with these two giants coming together, there is a high probability that the packaging, warehousing, and logistics will become far more organized, addressing the major pain point of the consumers living in Tier II and Tier III cities in India.

Increase in the number of discounts and deals for the online shoppers:

With Walmart coming into the picture and having a history of being extra-selective in picking up sellers, there will be a huge competition for prices.

This, in turn, will lead to less room for dubious businesses getting registered and selling sub-standard materials at huge discounts, impacting consumer purchase in a positive way.

Also, customers should prepare themselves to see a huge influx of online-exclusive deals from Flipkart.

The whole stunt of putting up massive discounts would now be more effectively executed because of the millions of dollars absorbed from the acquisition.

Globally, Walmart has been known to offer low prices to the customers through its efficient operations.

In fact, according to Aravind of Technopark,

One of the strategies of Walmart is ‘Every Day Low Pricing’ (EDLP), which is a result of a perfect sync in sourcing, supply chain, and frontend operations.

This will help the e-commerce giant push goods at a much faster rate and cater to the remote audience within a short span of time, thus fighting neck-to-neck with its rival Amazon.

Grocery at the doorstep:

Amazon is already an established player in the digital retail market. It has unlocked its first step towards establishing the future of grocery by taking up the ownership of Whole Foods.

Flipkart on the other hand, couldn’t do much in this section despite a lot of efforts and prior investment of 460$ million into E-kart.

It would be interesting to see how Walmart, who is already an established name and is among the largest procurer of perishable-produce and fresh items can add a different color to Flipkart’s effort in trying to reinvent the retail business.

But, one thing is certain. All this competitive tussle would certainly give end users a merry time.

They would be able to grocery shop online more often, up from one-two purchases a year to multiple purchases a month.

Conclusion:

Over the last decade, the Indian startup system has seen several ups and downs with the growth of Flipkart and has had a personal connection with the brand’s success story.

We don’t know yet what can be the later impacts of this acquisition but this is for sure that things will change as two biggest competitors in the online world come neck to neck.

Now, whether the change is good or bad, that is something that we will have to see.

Social-Marketing

Here Are 3 Ways You Can Overcome E-commerce Operations Mismanagement

There are myriad of industry resources that cling to building up e-commerce businesses with a great front-end customer experience and driving conversions with marketing.

On the contrary, there are hardly any, who are talking about the operational side of the e-commerce.

And, that’s terrible because in the hindsight you know how missing out on the esoteric tasks of filling up inventory, tracking goods, recording sales, restocking shelves, predicting future demands, and identifying any other long-standing loophole can work against your e-commerce business.

And we have proof,

In 2011, Best Buy’s Failure to Deliver Items on Christmas Loyal Customers

Nike’s Long-Lived Ordeal of Getting through the Operations

So, is there a secret to not let operations destroy your e-commerce business overnight?

Some dark magic formula that breaks through the barricades to save your business from running down to the nubs?

Not Surprisingly, Yes.

Let’s dig deep further here:

Al Ries, Chairman of the Consulting Firm of Ries and Ries in Atlanta says,

“Most of the bargain shoppers are impatient shoppers too.  And, the easiest way to convert them into ideal brand advocates would be to focus on core operations.”

Scalable Procurement:

Drawing from AI Ries, let’s start with few simple issues in operations.

  • When & how to deploy your resources (cost, time, and labor)?
  • How to promote valued relationships?
  • How to construct the ownership of actions and accountability of progress & ROI?

Since commercial enterprises depend a lot on supplied goods and services to get through the core business purpose, it’s crucial to have a right outlook to acquire the products and manage each individual section of the supply chain effectively, irrespective of who is performing the tasks.

And, this is where a scalable framework would come into play.

This is how ChiefProcurement.com defines Scalable Procurement:

“Scalable procurement is not just to authorizing people with desired professional skills to but giving non-practitioners in the organization the access to manage the balance of supply-side activity.’’

The right framework includes:

  • Code of Conduct to procure entities
  • Ethics of Gifts and hospitality
  • Division of authority to even the subordinates
  • Easy fraud management procedures
  • Supplier due diligence checklist
  • Responsible Sourcing Policy
  • Effective Supplier relationship and performance management procedures
  • Preferred supplier guidelines (who are the preferred suppliers for every category and why)

OmniChannel Maximisation

Among the top operations is the scenario where the offline & the online world are moving on two different tracks.

The sure thing is that the E-commerce businesses need to fill this gap.

But, an important question over here is how will they do this?

Let’s go to a recent past recent past and see how a brand could do it!

Fraport AG

It is a German airport company which also operates the Frankfurt Airport.

But, what is more, important for you to know here is that Fraport has another major service- the shopping service, called Fraport Store (or Frankfurt). It has over 300 retail outlets making Frankfurt the biggest shopping mall in Germany.

Back then, Fraport was just a big name in the offline market ie. for customers who visited the store at the airport.

To keep pace with the changes in technology, it soon opened an Online shopping for their users.

But to the surprise,  it was still missing a huge chunk of travelers who got less time to drop by the store and were very busy traveling.

How Fraport Could do the Omni Optimisation

The concept was seamlessly executed so that the customers can shop online while flying or on the off hours of their wait time, as well as pick-up, drop, ship, or deliver from store to any location within the airport or off-airport.

Of course, Fraport had to completely change the complex UI/UX design of its warehouse management software, synchronize the stores, drop-shippers, and third-party logistics to achieve this bold step of omnichannel vision.

But in the end, it could finally do that.

Now, here’s a right question- Is this something that your E-commerce brand can also achieve?

What can be the OmniChannel Operations best practices that you should possibly consider?

Let’s have a look at some quick best practices

  • Having a strategic plan
  • Integrating your existing systems

To break this down further, integration of the existing systems could happen by channelizing the organizational silos and bridging the disconnect between all previous multi-channel supply chains

  • Seeing technology as the liberator and picking up the right technology for your business
  • Promoting your business through new channels
  • Taking the right set of people

Fraud Management Detection

When you’re a smaller company, your orders are manageable and your fraud risk is relatively lower.

On the contrary, as orders increase, the issue of fraud management becomes crucial.

The backlog of orders demanding your review puts a lot of pressure in your operations, leading to:

longer fulfillment times and annoyed customers

shorter order review time to maintain promised fulfillment times and a higher rate of transactions as fraud slips through.

In such cases, a good fraud management tool comes to your rescue that not only gives you the right decision point but also backs it up with guaranteed protection.

As you scale, and margins are top of mind, it’s always advisable to offload your fraud liability for a low, predictable cost.

What tips do you have to overcome operations mismanagement?

Read about the above examples in detail below