- Indian e-tailer Flipkart has crossed the 100-million registered users mark
- It has become the first e-commerce company in the country to hit this milestone
Losses and cash burn
At the beginning of this calendar year, eight-year old, Flipkart, India's largest e-commerce company finally became keen to behave like any other sensible business venture by working towards cutting costs and posting profits. After burning an estimated $50 million a month and clocking up more than ₹2000 crore in losses, the company is now focussed on becoming profitable. It's cutting costs, rationalising staff, hiking commissions that it charges from sellers ( 10%-40%) and has reduced its return policy to 10 from 30 days. Apart from its profit-making categories such as fashion, electronics and large appliances, Flipkart now also wants to push furniture and automobiles to garner higher revenues.
CEO and valuations
After Binny Bansal replaced Sachin Bansal as CEO, he has been overhauling the system at the management level and said the firm was expected to turn profitable in three years. This after Sachin Bansal famously said, "We don't want to remain a small profitable company." This change in track comes at a time when global investors questioned its $15 billion valuation and wrote down their investments by more than 30%, yanking its valuations down to around $9 billion from $15 billion now.
Flipkart has a staff-strength of 'just' 30,000 employees. Recently it offered employees who failed to meet professional expectations the choice to either resign or be sent off with a severance pay. The decision is expected to impact 700 to 1,000 staff. This comes after Flipkart deferred the joining dates of fresh recruits from Indian Institute of Management, Ahmedabad, by seven months and had offered to pay a penalty of ₹1.5 lakh earlier in May this year. Sachin Bansal himself admitted that he was asked to vacate the CEOs position due to performance issues.
Last Updated 31, Mar 2018, 6:43 PM