Will sellers' sales share be limited? Flipkart plans to come up with a new plan to deal with the Indian government's new regulations

According to foreign media reports, India's No. 1 e-commerce platform   Flipkart plans to introduce a third tier of sellers, codenamed gamma, on its platform to curb the dominance of the preferred retailers ( top sellers ) who account for a large proportion of sales in the e-commerce market .

Currently, Flipkart has a two-tier seller structure: a small number of preferred sellers called alpha sellers, and a beta tier of wholesale sellers, which was implemented when rules were changed in 2018 to reduce the dominance of large sellers . Individual alpha sellers account for high single-digit or double-digit percentages of Flipkart’s total sales.

In order to promote healthy competition among enterprises, the Indian government has continuously improved the rules to regulate e-commerce platforms. According to the new regulations officially issued by India , e-commerce platforms should ensure that they are consistent with their role as market facilitators, maintain healthy competition, and shall not hold control over sellers and inventory supplies .

In order to comply with Indian national laws and official regulations and ensure the compliance and legality of the platform's operations, Flipkart had to make changes.

Flipkart may no longer hold inventory in the future. A head of a fast-moving consumer goods distributor said : "We have been informed that from now on, we will not get any purchase orders from Flipkart ... We have been asked to sign contracts with new suppliers. "

In addition, people familiar with the matter said Flipkart intends to limit the sales share of each large seller on the platform to 5% . Two people familiar with the matter also said that Flipkart is recruiting more than a dozen independent gamma sellers to be ready if Indian officials change foreign direct investment (FDI) laws in the future and further limit the sales share of any online seller.

The new regulations issued by the Indian government actually protect the interests of small and medium-sized enterprises (sellers) and prevent large sellers on the platform from forming a monopoly. Although in the short term, some platform policy changes prompted by the new government regulations will cause some inconvenience to sellers, in the long run, it will be conducive to the standardization of the overall environment of the e-commerce industry and fair competition among sellers on the platform.

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