Timely entry: Retail FDI clarification may prove a boon for Amazon

While Amazon has finally taken the plunge by offering its retail online store in India, the company is devising ways to make its presence felt.

According to an Economic Times article, Amazon plans to enter into partnerships with many leading retail chains in India to boost its sales.

The world’s largest online retailer plans ties with Shoppers Stop, Crossword, Spencer’s Retail, Woodland, Future Group and other leading retail chains in Indiato sell their wares through the Amazon India marketplace.

Naturally, Indian retailers are also only more than happy to tie up with a global brand like Amazon are keen to enter into selling agreement with it.

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[caption id=“attachment_851137” align=“alignright” width=“380”]  Amazon India is now open.[/caption]

Future Group’s Kishore Biyani told ET that Amazon marketplace constituted a good opportunity and they will consider it. Spencer’s Retail is also keen to enter the business with Amazon.

And, why not? After all, Amazon has always been a big player in the online retail space and can give a tough competition to eBay, Flipkart and Snapdeal in the books and DVDs market.

Firstpost take:

Interestingly, thegovernment’s clarification on its FDI policy for multi-brand retail yesterday is likely to make Amazon’s race in India easier.In the US, the company is engaged in a tough fight with its brick-and-mortar counterparts such as Wal-Mart and Tesco.

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Amazon has stayed away from directly selling any products to customers since IndianFDIregulations in multi-brand retail prohibits e-commerce trading in any form by foreign firms.

According to government clarifications issued yesterday, multi-brand retailers such as Wal-Mart andTescowill not be able to acquire an existing retailer to make an easy entry into theIndian market, thus makinga tighter set of norms that seeks to ensure they build chains right from scratch.

The rules are a big setback for Indian retail groups such as Bharti Retail, Future Retail and Spencer’s that were hoping to cash out by selling at least part of the stake in front-end retail stores to foreign companies.

But, Amazon wanting to rope in top retailers by providing its platform as a sales channel for them, may give them a reason to cheer.