BANGALORE: Amazon.com, the world's largest online retailer, has made an entry into the fast-growing Indian e-commerce market with its Amazon.in, which is designed as a market place that facilitates transaction between buyers and sellers.
The marketplace-available online at amazon.in-model helps Amazon overcome Indian regulatory hurdles that prevent foreign online retailers from having a fully owned Indian arm selling directly in India. Country manager Amit Agarwal said the model adopted by Amazon is fully compliant with all relevant Indian laws.
With about 130 million internet users, which is fast-growing, India is one of world's largest opportunities for online retailers.
In the current model, Amazon.in does not own any of the merchandise that is sold through the website but merely acts as an aggregator to all the retailers who wish to exhibit their products on the website. In Amazon's US website, there are both Amazon-owned goods and third-party products being sold.
To begin with, Amazon.in will sell some 7 million book titles available for purchase and nearly 13,000 movie titles and the online retailer plans to expand into other categories such as cameras and phones in the near future. Agarwal refused to share any timeline for this.
"Our vision is to become a trusted and meaningful sales channel for retailers of all sizes across India, enabling them to succeed and grow their business online," said Amit Agarwal, vice president, and country manager, Amazon India.
Amazon has been actively lobbying with the government of India to relax the regulations against foreign e-commerce companies and allow foreign direct investment in online retail. Global vice-president Paul E Misener met India's commerce and industry minister Anand Sharma in February to discuss the issue.
While the government had relaxed norms for offline multi-brand retail, where it allowed 51 percent FDI, it decided against implementing similar provisions for the players on the web.
Apart from letting retail sellers from exhibiting their products on the website, Amazon India has an option called Fulfillment by Amazon wherein it would provide end-to-end logistics solutions to retailers who wish to avail of this service.
"This is the same model which is followed by Amazon.com in other countries where fulfillment is done by Amazon. The seller still owns the inventory," said Greg Greeley, vice present- international expansions.
Amazon has started off by setting up a fulfillment center on the outskirts of Mumbai where merchandise is stored and delivered from, using Amazon's own personnel as well as third-party couriers.
Amazon.in faces stiff competition from Indian retailers like Flipkart, Snapdeal, Homeshop18 and Indiatimes Shopping owned by the Times Group. Amazon India is already operating Junglee.com, a price-comparison portal launched in February last year. Instead of selling products on its web page, Junglee.com sends visitors to the website of the seller.
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