FLIPKART

We have promise to keep and smiles to go before we sleep

AGENDA Company Profile Growth and Expansion/ Milestones Structure IT infrastructure Flipkart’s work flow chart Business Model Delivery/ Single Day Delivery Payment Methods M&A

COMPANY PROFILE

COMPANY PROFILE

Established in 2007 by Binny and Sachin Bansal Started with selling books Ventured into consumer electronics in 2010 Since then it is adding mobiles, computers,

cameras, clothing, home and electronic gadgets and appliances

Flyte- Digital Music Store (Digital market content) (Flyte’s operations have been discontinued)

COMPANY AT A GLANCE(2012)

•Its focus is on hiring.•looking to increase their current team strength from 13,000 to 25,000

GROWTH AND EXPANSION

MILESTONES

ORGANISATIONAL STRUCTURE

STRUCTURE

IT INFRASTRUCTURE

IT INFRASTRUCTURE Initially used MySQL Database which lagged during peak

hours MySQL used three servers with 6 HDD/server It Shifted to Virident FlaskMAX solution It improved Performance by removing I/O bottleneck,

improved site integrity (up-to date information) It reduced power usage by data centres Improved Performance by 50%, Better site stability at

peak hours, improved user experience and reduction of storage power by half.

WORK FLOW

The scenario discussed above is an ideal scenario where the

inventory is stocked in the Warehouse. Some other possibilities Are:

1. Back to back order fulfilment: In this case the operations download the orders and ask its runner to go to the vendor immediately and pick up the required SKUs from the vendor and bring it back to the fulfilment centre to fulfil the order.

2. Drop shipment: In this case the orders are downloaded and handed over to the vendor directly to fulfil the orders and ship it to the customers. The warehouse doesn't have any control over this fulfilment.

3. Made to order: In this case, the orders are first taken from the customer and then the purchase order is raised to procure the SKUs of that order from the vendor. Once the SKUs are in the warehouse, the normal fulfilment cycle (as described above in detail) is followed to process the order.

BUSINESS MODELS

FLIPKART MARKETPLACE MODEL Flipkart India Pvt Ltd, with 3.5 million daily visits and 18 million registered users

moved to marketplace model in February 2013 after selling it’s company-owned inventory

It has signed a MoU with the Federation of Indian Micro and Small and Medium Enterprises (FISME) and the National Centre for Design and Product Development (NCDPD) to help small businesses sell online

It will host products from 50,000 small enterprises as it scales up its marketplace model

Flipkart has now more than 3,000 merchants Disadvantage: The shipping cost is higher because multi-product orders are

fragmented across vendors and shipped separately. And this in turn may lead to customer dissonance because a customer won’t receive their entire order at one time

FLIPKART DELIVERY

eKart, the logistic arm of Flipkart is a part of WS retail services

It is Flipkart’s in-house vendor and was the sole seller through Flipkart before it turned into a marketplace.

Currently, eKart is running a pilot programmed with a few partners and intends to roll out these services in the next few weeks

SINGLE DAY DELIVERY & SAME DAY DELIVERY

Same day guarantee delivery in 10 cities across India Place the orders by 12 and it will be delivered by 9pm on the same day. An additional shipping fee of Rs 200, which has currently been reduced to

an introductory pricing of Rs 140 It will refund the product value (of up to Rs 5,000) back to the user’s

wallet if the product is not delivered on the same day This service is however currently available for products sold by WS Retail Not available for recently launched Large Segment appliances category

(TV’s) due to different supply chain Separate system in supply chain which works like parallel track to standard

delivery with lesser lead time(time between initiation and execution) Priority for Packing, shipping and delivery Single day delivery in 27 cities across India

PAYMENT METHODS

PAYMENT Cash-on-Delivery : Max value ₹50,000, 60% transactions, Order on phone: 20% of its orders, 2.5 m downloads Payment using Visa, MasterCard, Maestro and American Express credit/debit

cards, Internet banking, DD/Cheque Flipkart's EMI scheme is available for American Express, Citi, HDFC and ICICI

credit card holders only. You may choose to pay in 3,6,9,or 12 month instalments. The minimum order value >= Rs 4,000.

E-Gift Voucher (eGV) Wallet: Prepaid credit up to 10K

Two compartments - Flyte and WS Retail Any new Wallet Top-ups will be limited to purchases in the Flyte category -

MP3s and eBooks Unused top-up balance, may be used to purchase across all categories till it is

exhausted Ezetap. It can work through a dongle that can be plugged into smartphones &

tablets. Customers can just swipe their cards when the delivery boy gives them their product

The unique steps for payment used by Flipkart are:1. Auto redirection to banking site: Flipkart never lands you on

CCavenue page2. Banks Status: It maintains its own real time status if the bank’s net-

banking is working or not Payment gateway PayZippy:

It enabled card payments for merchants websites and mobile sites, while its B2C version allows customers to store their card details and make payments on partner merchant sites

Flipkart have made a strategic investment in mobile payment company Ngpay (JiGrahak Mobility Solutions Pvt Ltd), and it is phasing out Payzippy (Has been discontinued.)

Payzippy’s clients include babyoye, Bluestone, Makemytrip, Travelyaari, Caratlane, Yepme, Zansaar, Lenskart and Yepme

M&A

FLIPKART ACQUIRES MYNTRA

Flipkart acquires Indian fashion portal Myntra on May 22nd 2014. Financial terms of the deal were not disclosed. Mint pegs the deal at $330 million while other sources pegs it at Rs.

2000 Cr Venture capitalist involved are Tiger Global Management, Accel

Partners and Sofina Capital. The deal involved transfer of cash and stock.

Post acquisition, Myntra and Flipkart will account for 50% market share in Fashion.

All Myntra employees get Esops which will now be converted to Flipkart stock

Myntra will retain its employees and will function independently.

22nd May 2014

$330mn or Rs

2000 Cr

FLIPKART ACQUIRES LETSBUY.COM

Flipkart acquires Letsbuy.com, country’s second-largest online electronics retailer for an undisclosed amount on 10th February 2014.

People familiar with the matter said it was worth around $20 million or Rs 125 Cr.

Flipkart and Letsbuy have common investors—Tiger Global and Accel Partners.

The acquisition is a combination of cash and equity. The founders of Letsbuy.com, along with more than 350 employees, will

function independently.  Letsbuy can now access Flipkart’s technology platform and supply chain

capabilities.

10th February

2014

$20 million or Rs 125 Cr

MYNTRA ACQUIRES FITIQUETTE

Myntra acquires San Francisco based Fitiquette. The financial details of the deal were not disclosed. The company said the

acquisition was part cash, part stock. Fitquette is a technology solution which is a virtual fitting room. It has

developed pioneering technology for solving the fit/size problem online. As part of the acquisition, Fitiquette team has joined Myntra with Andy

Pandharikar, CEO & Co-founder of Fitiquette heading Myntra's Innovation Labs in San Francisco

5th April 2013

NA

FLIPKART ACQUIRES CHAKPAK.COM

Flipkart acquired Chakpak.com, a Bollywood news site that offers updates, news, photos and videos.

The exact terms of the deal and financial details have not been disclosed.

Chakpak.com and Flipkart.com are backed by international venture capital firm Accel Partners.

The acquisition is only of content i.e.  the rights to Chakpak’s digital catalogue which includes 40,000 filmographies, 10,000 movies and close to 50,000 ratings.

Flipkart will not be involved with the original site and will not use the brand name.

Somewhere in 2011

N/A

FLIPKART ACQUIRES WEREAD

Flipkart acquired weRead.com, the largest social network based book recommendation and review platform from Lulu(US).

We read has 3 million readers and 60 million books in order to target NRI’s.

It involved a cash and stock transaction. It has enabled Flipkart to suggest the most relevant books to its readers

based on their previous purchase patterns as well as the kind of books they and their friends like.

22nd Decembe

r 2010

$25 million

SUMMARYS.No M&A Date Companies Involved Deal Size

1. Flipkart - Myntra 22nd May 2014 Flipkart, Myntra, Tiger Global Management(VC), Accel Partners(VC) and

Sofina Capital(VC)

$330 million

2. Flipkart-Letsbuy.com 10th February 2013

Flipkart, Letbuy, Tiger Global(VC) and Accel

Partners(VC)

$20 million

3. Mynta-Fitiquette 5th April 2013 Myntra, Fitiquette(San Francisco)

NA

4. Flipkart –Chakpak.com 2011 (June-August)

Flipkart, Chakpak.comAccel Partners(VC)

NA

5. Flipkart-Weread.com 22nd December 2011

Flipkart and Lulu(US) $25 million

* VC-> Venture Capitalist

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