Flipkart’s desperate pursuit of profits is squeezing out major fashion brands

Flipkart India has been racing to turn a profit in recent times, and major lifestyle brands in one of the company’s largest business segments have been hit.

Since January, the e-commerce giant Walmart’s business-to-business (B2B) division has tasked its fashion and lifestyle category managers with acquiring more customers from partner brands.

These initiatives were launched last October during a flagship event
The Big Billion Days

The Big Billion Days

A weekly sale offered to customers by Flipkart India, with special benefits for Flipkart Plus members

The Big Billion Days

(BBD) sales, but it only really took off in January. The goal was to become
EBITDA

EBITDA

Earnings before interest, taxes, depreciation and amortization

EBITDA

positive in six to eight months, which required better performance in the fashion category, said a former Flipkart executive Ken.

Among those feeling the pressure is Spykar Lifestyle, a denim clothing brand that has partnered with an e-commerce platformrm for a decade. According to Shrikant Tripathi, the brand’s e-commerce manager, its annual sales on Flipkart would be Rs 200 crore ($24 million) in 2023.

“In December 2023, Flipkart approached us with an offer to increase margins, which we declined,” Tripathi said.

Flipkart is in negotiations with a list of brands including American sportswear and footwear brand Nike, German sportswear brands Adidas and Puma, Indian footwear brand Woodland, Japanese watch and electronics maker Casio and Indian clothing retail giant Aditya Birla Fashion Retail Limited (ABFRL).

Seven brands Ken I spoke to Flipkart, who said the push to increase revenue is nothing new.

“It’s like paying rent,” said Nike’s former South East Asia and India e-commerce and distribution chief. “The landlord will ask for a year-on-year increase, but the tenant will want the rent to remain as stable as possible, or even go down.” They and six others who work for lifestyle brands declined to be named because they were not authorized to comment publicly on the company or brands.

But this time the e-commerce giant that
is intended to be

is intended to be

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is intended to be

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profitable even before being listed on the stock exchange, it pursues brands much more aggressively.