Flipkart in consolidation mode for Ekart, shuts down months-old services
BENGALURU: Online marketplace Flipkart is looking at consolidating business of its in-house supply chain arm, Ekart Logistics. The company has suspended the customer-to-customer courier service within months of its launch. It has also pulled the plug on hyperlocal delivery services being piloted across Bengaluru since March last year.
"Beginning February 5, Ekart no longer operates its customer-to-customer courier service started in May 2016, that gave people the option of having documents and parcels packed by Ekart's delivery boys and shipped to end-addresses," the company said in response to ET's emailed queries. The move is aimed at "consolidating the service offerings of Ekart, to sharpen its focus on its core business model", the company said.
Ekart processes 30,000-40,000 orders a day for third-party businesses excluding the volumes generated by Flipkart and Flipkart-owned fashion portal Myntra.
It will continue its core ecommerce offerings, including third-party logistics services to ecommerce players such as Paytm and ShopClues. It will also continue to provide warehousing and fulfilment facilities to larger retail clients such as Madura Garments.
The changes come after Ekart head Saikiran Krishnamurthy left the company last month and Nitin Seth took over the role in addition to his responsibilities as the chief operating officer. The reshuffle in top management has been linked to Tiger Global's Kalyan Krishnamurthy taking over as CEO of the company to streamline expenses.
In an interview to ET before his exit on January 5, Saikiran Krishnamurthy had indicated that over the next two years half of Ekart's business would come from servicing third-party players, who account for only 10% of the business handled by the company.
The Ekart brand was acquired by Flipkart under a company called Instakart Services in 2015 from WS retail, the primary seller on the platform. Since then, it has been the flagship vertical for cofounder Binny Bansal, who initiated the process of bringing external business for Ekart to monetise excess capacities and create an independent logistics vertical.
"Beginning February 5, Ekart no longer operates its customer-to-customer courier service started in May 2016, that gave people the option of having documents and parcels packed by Ekart's delivery boys and shipped to end-addresses," the company said in response to ET's emailed queries. The move is aimed at "consolidating the service offerings of Ekart, to sharpen its focus on its core business model", the company said.
Ekart processes 30,000-40,000 orders a day for third-party businesses excluding the volumes generated by Flipkart and Flipkart-owned fashion portal Myntra.
It will continue its core ecommerce offerings, including third-party logistics services to ecommerce players such as Paytm and ShopClues. It will also continue to provide warehousing and fulfilment facilities to larger retail clients such as Madura Garments.
The changes come after Ekart head Saikiran Krishnamurthy left the company last month and Nitin Seth took over the role in addition to his responsibilities as the chief operating officer. The reshuffle in top management has been linked to Tiger Global's Kalyan Krishnamurthy taking over as CEO of the company to streamline expenses.
In an interview to ET before his exit on January 5, Saikiran Krishnamurthy had indicated that over the next two years half of Ekart's business would come from servicing third-party players, who account for only 10% of the business handled by the company.
The Ekart brand was acquired by Flipkart under a company called Instakart Services in 2015 from WS retail, the primary seller on the platform. Since then, it has been the flagship vertical for cofounder Binny Bansal, who initiated the process of bringing external business for Ekart to monetise excess capacities and create an independent logistics vertical.
