Flipkart is a leading Indian e-commerce company headquartered in Bangalore, Karnataka. It was founded by Sachin Bansal and Binny Bansal in 2007. In its initial years, Flipkart focused on online sales of books, but it later expanded to electronic goods and a variety of other products. Flipkart offers multiple payment methods like credit card, debit card, net banking, e-gift voucher and Cash on Delivery.
When Sachin Bansal and his room mate Binny Bansal decided to quit Amazon India in 2007 to start their own humble online bookstore, many were skeptical about their start-up. One reason people were so sceptical was that the two were first-generation entrepreneurs who did not come from a business family background – Sachin’s father was a farmer and Binny’s was a government employee. Few believed that the two university friends – who happen to share the same surname – could turn a $10,000 investment into a business generating multi-million-dollar revenues in less than five years. Initially flipkart was funded by the Bansals themselves with Rs.400,000.
They began working from a two-bedroom apartment in Koramangala. One of the rooms was converted into an office. They tied up with all the distributors of major Indian publishers in Bangalore. Every day, one of them would go on a bike and buy books to make their own catalogue. They would sit down on the floor and make the packages to give to the courier agencies for shipment. That went on for three months, with just two people running the whole show.
Initially, they were running the company with just two computers from our room. The first order came 10 days after they launched the site. A guy in Andhra Pradesh bought “Leaving Microsoft to Change the World” by John Wood, who quit his job to set up the charity Room to Read. To them, it all seemed quite ironic as they had quit Amazon to change their lives. Next day, they went to several distributors in Bangalore, but most of them didn’t have it. Finally, they traced the book to a store in the Indiranagar area of Bangalore. Binny went there to pick up the book, then found out he didn’t have his wallet and called a friend who worked nearby to give him money. Somehow, they packed it and shipped it to the customer. They informed their first customer about the delay. It took them two days to find it. They sold it at a loss to make up for the delay in delivery.
Setting up the operation from scratch was the hardest task for them. At the beginning, it took some time to get book distributors and vendors to believe that what they were doing was serious and had potential.Flipkart broke even after only six months, allowing the two emerging entrepreneurs to start reinvesting profits into a new office space and employees. They didn’t take a salary for 18 months and lived off our savings and a little pocket money from their parents, who were very supportive.
They looked at how Chinese companies—where e-commerce is huge—did retail online. The US has an established credit card culture, while China (like India) is a cash-based economy with lesser credit card penetration. So looking at e-commerce models in China, they put in place a cash-on-delivery system. Today, more than 50% of their orders operate on a cash-on-delivery basis. 50% of their orders come from the metros: Mumbai, Bangalore, Delhi, Chennai, Kolkata and Hyderabad. The remaining buyers are from other parts of the country. Each day, Flipkart ships thousands-odd items through the government book post as so many villages don’t have courier facilities.
In 2010 WeRead, a social book discovery tool is acquired. The stated goal was to give Flipkart a social recommendation platform for buyers
to make informed decisions based on recommendations from people within their social network.In 2011 Mime360, a digital content platform company is aquired. In 2011 Flipkart acquired the rights to Chakpak’s(a Bollywood news site that offers updates, news, photos and videos) digital catalogue which includes 40,000 filmographies, 10,000 movies and close to 50,000 ratings. In 2012 Flipkart has bought Letsbuy.com,India’s one of largest e-retailer in electronics, for an estimated US$ 25 million. In February 2012, flipkart launched its ‘Flyte Digital Music Store’. Flyte is a legal music download service. In 2012, Flipkart has launched its own product range under the name “DigiFlip”, offering camera bags, pen-drives, headphones, computer accessories, etc. In April 2013, Flipkart launched its marketplace platform on Saturday, allowing third-party merchants to sell their products on its website. A Marketplace allows the multiple third party companies to create their own ecommerce stores by listing their products and inventory information on its website and then the consumers can access to various brands and compare the prices offered by various sellers. Flipkart had launched an online payment gateway PayZippy for Indian merchants in July 2013.
In May 2013, flipkart declared to close its music download service, Flyte, due to problems being faced by the firm such as music piracy and micro-payments. In December 2013, Flipkart launched single day guaranteed premier shipping service, named ‘In-a-day Guarantee’ after Amazon India launched similar service. In May 2014, Flipkart acquired online fashion retailer Myntra in an estimated Rs 2,000 crore deal. It is India’s largest e-commerce deal.
