E-commerce major Flipkart has appointed half-a-dozen companies as intermediaries between its wholesale unit and some preferred sellers on its platform to get around the revised FDI policy which rules 25% cap on direct purchases from entities related to marketplaces, said sources familiar with the development.
Sports Lifestyle, Premium Lifestyle & Fashion India and Wishberry Online Services are among the intermediaries that will purchase products from Flipkart wholesale and supply them to preferred sellers including SuperComNet, Omni-Tech Retail and RetailNet, which will then offer them on Flipkart.
The latest restructuring of Flipkart’s operational model comes after the implementation of revised FDI norms for e-commerce in February. India allows FDI only in marketplaces that offer platforms for other businesses and sellers and bars them from holding inventory and influencing prices.
The rules state a vendor will be considered “controlled” by an online marketplace operator if it sources more than 25% of its merchandise from an entity related to the e-commerce company. Flipkart is reportedly creating a layer of business-to-business entities to act as intermediaries between its wholesale arm and prominent sellers on its platform.
