Not afraid of Amazon or Alibaba, says Sachin Bansal; stresses on ecom cos' need to raise funds
Flipkart co-founder and executive chairman Sachin Bansal said ecommerce companies will need to continue raising funds to invest in functions such as talent and technology as the sector is still at its infancy.
"E-commerce will need a lot more investments because the market is constantly growing, it's still at its infancy, it's going to grow in double digits for many more years. Therefore, we will have to keep adding to the talent pool, need to constantly improve the physical supply chain, find new and innovative ways to analyse data, and relentlessly work on improving the technology to offer better customer experience," he said at the Global Mobile Internet Conference (GMIC) in Bengaluru on Wednesday.
"It's all about the right time to look for profitability, until then we will have to continue investing," he said.
The GMIC, organised by US-based Great Wall Club (GWC), is being held on 16 and 17 November. GWC is an invitation-only, private network for innovators and executives from leading mobile companies worldwide.
According to recent media reports, Flipkart is trying to raise fresh funds from the world's largest retailer Wal-Mart Stores Inc., and Canadian fund CPPIB. On the home turf, it is fighting an intense battle with the Indian arm of US-based Amazon.com, Inc. to maintain its leadership. The company is reportedly trying to raise $1 billion in fresh funds.
Talking about the increasing pressure the home-grown company has been under since the arrival of Amazon in India and from the likely entry of Chinese retailer Alibaba, Bansal said he is "not afraid of Amazon or Alibaba" and that any company that manages to 'Indianise' its offerings for the local customers would eventually succeed.
Bansal also touched upon the recent demonetization move and said the decision was a wake-up call for digital companies. "It suddenly converted tens of thousands of people into digital consumers, and this transformation is a huge business opportunity for everyone who's willing to be a part of India's digital transformation," he said.
He said digital and cash transactions contributed equally to the total sales taking place on Flipkart's platform but post demonetization, all the transactions had turned digital. Bansal also expressed his desire to work with the government to offer his services and ideas to further improve the implementation of demonetization.
The drive, he said, will have long-term positive impact. "With programs such as Pradhan Mantri Jan-Dhan Yojana that attempts to provide every Indian with a bank account, the digital revolution has just started and that will offer unprecedented business opportunities in the digital space," Bansal said.