Online marketplace Flipkart will invest a “couple of billion dollars” in the next few years on beefing up its logistics network as part of efforts to strengthen its position in the booming e-commerce industry. Flipkart, which competes with Snapdeal and Amazon besides other smaller players, on Friday opened its largest warehouse in Telangana. It plans expanding its network of warehouses across the country to speed up delivery of goods to consumers and will pump in USD 500 million over the next 4-5 years. “The USD 500 million is for warehouses… investments for logistics will be much bigger… it will be more than couple of billion dollars. It is a very long term investment plan over next 5-6 years,” Flipkart co-founder and COO Binny Bansal told reporters here.
Driven by increasing Internet population and growing preference for online shopping, ecommerce companies have witnessed a huge jump in sales. They are investing heavily on infrastructure, including warehouses and last-mile reach to speed up delivery of products and enhancing consumer experience. Flipkart’s rival Snapdeal is investing USD 150-200 million (about Rs 940-1,250 crore) in the ongoing fiscal to expand its delivery operations. It had also picked up a minority stake in logistics firm GoJavas. While Snapdeal has 63 fulfilment centres in the country, US-based Amazon has also been expanding its network of warehouses and has 21 such centres. “Over the next 4-5 years, the plan is to invest more than USD 500 million in warehousing in the country. We are hoping to build a network of 80-100 fulfilment centres across all states,” Bansal said. He added that more than half of them will be in tier II and III towns.
