E-commerce players are rapidly placing bets on offline businesses which can help them in their core operations.
A few days after Amazon had announced that it was buying 5% of Shoppers Stop for Rs. 180 crore, Flipkart has announced that it’s acquiring F1 Info Solutions and Services. F1 Info Solutions was founded in 2012 and runs more than a hundred service centers across India where it repairs phones, laptops and gadgets. F1 Info Solutions co-founder and CEO Shammi Moza will join Flipkart as a Senior Director and report to Flipkart VP Abhijit Upadhye.
Flipkart’s acquisition of an electronics repair company isn’t surprising — smartphones account for a disproportionately large percentage of overall revenue for the company, and tying up with a repair and service provider will help it significantly expand its post-sales capabilities. F1 Info Solutions and Services is a “neutral” service provider working with a wide variety of brands, which means that Flipkart can use its services for a wide swathe of phones sold on its site.
Flipkart’s acquisition of an offline phone repair company will only serve to cement the opinion that traditional e-commerce players are now realizing that growth lies in making moves in the offline world. Most e-commerce retailers have been setting up physical stores — Lenskart now has 700 stores in the country, and furniture companies such as Pepperfry and Urban Ladder have been opening stores in prime locations. Flipkart’s fashion brand, Myntra, too has an experimental physical shop in Bangalore. And in the biggest move in the space, Amazon had announced it was buying 5% of Shoppers Stop in a move that would give it access to its 80 stores.
Flipkart’s acquisition of F1 Info Solutions and Services will also give it considerable foothold in several cities across India. F1 runs stores that are geographically quite well spread, and Flipkart could use these stores as a dedicated point for mobile services and exchanges. And the real estate could come in handy — Flipkart could use their stores as pick up points for regular Flipkart customers.
The fight for online commerce, it would seem, is rapidly moving offline.