As Amazon and Walmart company Flipkart has spent billions to weigh on the Indian retail market and recover from the recent regulatory hurdles. Both companies have faced a new challenge: Mukesh Ambani, Asia's richest man.
Reliance Retail and Reliance Jio, two subsidiaries of Ambanis Reliance Industries, announced that they are releasing JioMart, their e-commerce company that works closely with neighborhood stores, in parts of the state of Maharashtra (Navi Mumbai, Kalyan and Thane) have brought the market.
The e-commerce company, which is marketed as "Desh Ki Nayi Dukaan" (Hindi for the country's new business), currently offers a catalog with 50,000 foods and promises "free and express delivery".
In an email to Reliance Jio users, the two aforementioned subsidiaries that are collaborating on the e-commerce project announced that they plan to expand the service to many parts of India in the coming months. The joint venture has also asked Jio subscribers to sign up for JioMart to get access to introductory offers. A Reliance spokesman declined to share more.
The soft launch this week takes place months after Ambani, who heads Reliance Industries – India's largest industrial company – says he wants to supply tens of millions of retailers and shopkeepers across the country.
If there is anyone in India who is competing with Amazon and Walmart, It is Ambani. Reliance Retail was founded in 2006 and is the country's top-selling retailer. It serves more than 3.5 million customers a week through its nearly 10,000 stores in more than 6,500 Indian cities.
Reliance Jio is the second largest telecommunications operator in India with more than 360 million subscribers. The pure 4G airline, which commenced commercial operations in the second half of 2016, disrupted the country's established telecommunications operations by offering mass data and voice calls for free over a longer period of time.
In a January speech, Ambani, an ally of Indian Prime Minister Narendra Modi, said Mahatma called Gandhi and, like Gandhi, who led a movement against the political colonization of India, said: "We must start a new movement against data colonization together. For India to be successful in this data-driven revolution, we need to move control and ownership of Indian data back to India – in other words, Indian prosperity back to every Indian. "
Participants included Modi, whose government had just announced regulatory challenges that would affect Amazon and Flipkart.
E-commerce continues to make up only a fraction of total retail sales in India. Technopak Advisors estimates that the Indian retail market will grow to $ 188 billion in the next four years (compared to $ 79 billion in the previous year).
In an interview earlier this year, Amit Agarwal, manager of Amazon India, said: "One thing to note is that e-commerce accounts for a very, very small proportion of total retail consumption in India, probably less than 3% . "
To make their businesses more attractive to Indians, both Amazon and Flipkart have expanded their range and opened up new business areas. Both platforms have started selling food in the past few quarters and are also dealing with food retailing. Amazon has invested in a number of retailers in India, including the second largest Indian retail chain Future Retail & # 39; s Future Coupons, the Indian supermarket chain More and the department store chain Shopper & # 39; s Stop.
Flipkart has invested in a number of logistics startups, including ShadowFax and Ninjacart. Amazon India was also in talks with Ninjacart to acquire a stake in the Bangalore-based startup.
In recent quarters, Reliance Jio executives have been aggressively turning to shopkeepers in many parts of India to showcase their point-of-sale machines and motivate them to join JioMart, many retailers said.