Flipkart to shut down eBay India on August 14 and launch new platform for selling refurbished goods

The top two e-commerce platforms in India are Flipkart and Amazon. Other e-commerce platforms include Snapdeal, eBay India, Paytm Mall, and Tata CLIQ. eBay India was launched nearly fourteen years ago. In April 2017, eBay made a cash investment of $500 million in Flipkart and sold its eBay.in business to the e-commerce giant in exchange for an equity stake in Flipkart. In August 2017, the deal was completed and eBay became a Flipkart Group company. Now, however, Flipkart has announced that it will shut down eBay India and launch a new platform to sell refurbished goods in the country.

This means that Flipkart and eBay’s strategic partnership has ended. The decision to shut down eBay India was revealed by Flipkart CEO Kalyan Krishnamurthy in an email to the company’s employees. eBay India confirmed the report by stating that it will stop accepting new orders from August 14, 2018.

eBay India has stated on its Transition FAQ page that the website will stop accepting new orders from August 14. Sellers are able to list new items only until July 31, 2018. The company asks users to visit its global site to continue buying and selling products internationally (although it should be noted here that many items sold on eBay.com simply don’t ship to India). Sellers on eBay.in will not be able to transition their seller status between platforms. They will need to register as a seller again on Flipkart.

Flipkart CEO Kalyan Krishnamurthy stated in the email to Flipkart employees that the company has built “a new value platform launching with refurbished goods.” He did not specify the name of the new platform, but identified that the two main issues with selling refurbished products in India were trust and convenience. His view is that Flipkart can solve these issues at scale thanks to the company’s customer base.

Mr. Krishnamurthy stated in the email: “Based on our learnings at eBay.in, we have built a brand new value platform launching with refurbished goods – a large market which is predominantly unorganised. With Flipkart’s customer base, and F1 Info solutions & services in our group portfolio, I believe that we can solve the key barriers to refurbished – trust & convenience – at scale. We will keep evolving and bringing newer formats, categories and features which cater to the needs of our value-conscious middle India.

“The new platform has a different value proposition compared to Flipkart, and will cater to a different target audience. We are committed to investing in this independent brand […].”

To recap, Walmart acquired a 77 percent stake of Flipkart for $16 billion in May—its biggest foreign investment yet. After this deal was announced, eBay had sold its holding in Flipkart.

The new platform for refurbished goods will cater to a different target audience, according to Flipkart. This will have an impact on smartphones as well. eBay India failed to succeed in the Indian e-commerce space because of various factors, but it did sell many products that simply weren’t available on Flipkart or Amazon, such as used and refurbished products, niche products, etc. In the smartphone market, eBay India lost ground many years ago because of the rise of online exclusives.

Refurbished smartphones aren’t widely popular in India as of now, unlike other markets. If refurbished smartphones are sold on Flipkart’s new “value platform,” this could have an impact on smartphone pricing in India. Currently, online smartphone sales in India are smartphone sales restricted to a particular e-commerce platform. For example, the Samsung Galaxy S9 is an online exclusive on Flipkart, while the OnePlus 6 is an Amazon exclusive. We will have to wait and see how this plays out.

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