Amazon Says Will Continue to Invest 'Very Heavily' in India
Global e-commerce giant Amazon continues to invest "very
heavily" in the Indian market, encouraged by its strong sales numbers and
expanding seller base, a top company executive has said.
Amazon Senior Vice President and CFO Brian T Olsavsky said the
US-based company has seen sales quadruple during the festive season (pre-Diwali
sales) compared to last year.
"We're really encouraged with what we are seeing, both on the
customer side and the seller side. On the customer side, active customer
accounts are up 230 percent year-over-year.
"We are in the middle of the Diwali season that is going
really well. Sales are 4x what they were last year," he said on an
investor call. Olsavsky added that the company has been adding 40,000 products
a day so far this year on its platform and the number of sellers has grown more
than 250 percent year-on-year.
"About 90 percent of those sellers are using our logistics
and warehouse services. And as a result, we've tripled our fulfilment capacity
year-over-year. "So, we are very encouraged, as I said last quarter in
India, and continue to invest there very heavily," Olsavsky said.
However, he declined to disclose specific investment details.
India is one of the fastest growing markets for Amazon. The online retail giant
had announced an investment of $2 billion (roughly Rs. 13,000 crores) to expand
its operations in India last year.
Amazon, which competes with the likes of Snapdeal and Flipkart in
India, operates under a marketplace model here as regulations in the country do
not allow foreign capital in business-to-consumer (B2C) e-commerce.
According to a BCG report, the e-commerce industry in India is
expected to touch $60-70 billion (roughly Rs. 3,89,990 crores - Rs. 4,55,044
crores) by 2019 from $17 billion (roughly Rs. 1,10,510 crores) in 2014.
Amazon is investing heavily into setting up warehouses across the
country to speed up delivery and efficiency. Earlier this month, it set up a
new fulfilment centre in Pune, taking the total count to over 21 with a
cumulative storage capacity of over five million cubic feet.
"India is a different market and does not have a lot of the
same ready fulfilment options that some other countries did. We see that as an
opportunity," Olsavsky said. He added, "We like what we see in India.
We think we're attractive both to customers and to sellers and we like our
position."
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