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Flipkart-Spencer’s Retail confirms partnership; Flipkart exploring more alliances, Retail News, ET Retail

Flipkart-Spencer's Retail confirms partnership; Flipkart exploring more alliancesKolkata: Flipkart is going to enter into a series of partnerships with brick-and-mortar retailers and leading FMCG companies to spruce up its offerings in its weakest business area of essentials. On Thursday, it has formed such an arrangement with Spencer’s Retail.

As part of the deal with Spencer’s, the retailer will become a seller on the Flipkart platform and sell special packs of staples and FMCG products which will be delivered by Flipkart’s last-mile delivery network. This is probably one of the first such partnerships between an ecommerce firm and a retailer who otherwise compete against each other, industry executives said.

ET had first broke the story on the Flipkart-Spencer’s partnership in its web edition.

The Walmart-owned ecommerce firm is in advanced talks also with Hindustan Unilever and ITC to sell their essential products through its marketplace, and has approached other retailers like D’Mart. Flipkart is also trying to expand the presence with kiranas.

Flipkart-Spencer's Retail confirms partnership; Flipkart exploring more alliances

“We are in extraordinary times and this is quite a unique partnership where we come together to serve essentials to consumers,” said Spencer’s retail managing director Devendra Chawla. “In such times, building an ecosystem of partnerships will transition us to truly become an omni-channel business in serving consumers,” he said.

“In this tough environment, Spencers’ partnership with Flipkart provides
another platform to a larger set of consumers to seamlessly access our range of essentials who may want to use other reputed platforms/marketplaces apart from our own Spencers App to buy during the lockdown,” said Chawla.

He said the company had built a tech-backed platform to offer consumers real-time insights of essentials available in their area and would ensure timely doorstep deliveries.

An ITC spokesperson confirmed discussions with Flipkart, while HUL and D’Mart declined to comment.

The ITC spokesperson said the company was working on ensuring availability of essential products like atta, salt, spices, biscuit and hand wash for consumers and one of the avenues was leveraging collaborations with partners including online platforms like Flipkart.

For Spencer’s, which now also owns the premium Nature’s Basket chain, this partnership will help expand its presence to online.

The RP-SG Group-owned retail chain with over 200 stores in 45 markets has been on a partnership-making spree to ensure home delivery of groceries and essentials becoming an omni-channel retailer, having tied up with Uber, Rapido and other mobility fleets.

The Flipkart-Spencer’s pilot started in Hyderabad and will allow the retailer to reach new consumers who were on Flipkart platform but not consumers of Spencer’s till now. Industry executives said it will be expanded into other cities.

Flipkart has traditionally been strong in smartphones, electronics, apparels and home products. Food and grocery contributed just 2-3% to total sales, an industry executive said.

Due to its small presence in grocery, Flipkart was lagging behind competitors like Amazon and Grofers after the lockdown was clamped, the executive said. Also, consumers are likely to continue online purchase of essentials even after the lockdown because of the worries over the Covid-19 outbreak.

Flipkart has taken its food and grocery sales to 300 markets from just five earlier and converted existing warehouses to stock such products with a special permission from the Centre, since the process usually takes time including the requirement of APMC licences from each state.

The marketplace is hiring 4,000 people to handle its essentials logistics and warehouses and paying additional incentives whereby the attendance level has improved to 80-85%, an industry executive said.

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