Amazon India has managed to grow so rapidly in India that they almost caught Flipkart sleeping. The fact that these two have eaten up almost the entire market in the e-commerce section tells us how dominant the companies are. The rivalry is also something to watch out for. Amazon, when it entered the market was almost $1.6 billion behind in terms of revenue from Flipkart. And today the company in India has a revenue of about $3.2 billion while Flipkart’s revenue stands at $3.6 billion.
That said, Flipkart now has been bought by Walmart and it is essentially a fight between two American giants rather than one Indian and one American. Both the companies have had their fair share of fights in the American market but are now all geared up to lock horns in the subcontinent of India. That said, Walmart tried to enter the Indian market twice before buying Flipkart. However, it failed miserably and its physical stores were not well received at all in India.
In that case, the American giant decided to buy the biggest e-commerce website in India and now has a stronghold in the market all of a sudden. That said, only months after entering the Indian market, the Department for Promotion of Industry and Internal Trade (DPIIT) came out with a new FDI policy which chained the e-commerce giants of many things such as exclusivity, private labels, and many more things. This sent all the e-commerce companies into a frenzy and has caused a lot of ruckus amongst the companies.
Flipkart and Amazon had requested the deadline extension for the new FDI policy to take shape but DPIIT rejected it and now the companies faced huge losses. The losses were so huge that the company lost points at the share market. Walmart and Amazon lost a whopping $50 billion combined after the new FDI policy took shape.
Amazon came out worse as it lost a staggering $45.22 billion. The share price of Amazon slipped to $1,626 which was downed by 5.38%. The Nasdaq-listed company had made a lot of promise to the Indians. It had stated that it will invest around $5 billion in India which is a major doubt after such a hefty loss.
Walmart, on the other hand, lost $5.7 billion after the policy went live. Its shares fell by 2.06% and were valued at $93.86 on the New York Stock Exchange. Amazon was valued at $795 billion and Walmart at $272.69 billion.
Their overall revenues will take a hit due to this. The companies will have to cope up with everything that comes their way now. The challenges are going to be relentless as many brands will look at the offline retailers and the online market will have to fight to get their products on their platforms.