The new policy puts a series of curbs on how both Amazon India and Flipkart operate—restricting discounts, no ownership in sellers on the marketplace platform and disallowing exclusive product launches—forcing them to restructure operations and take a hit on sales.
After removing critical alpha-sellers in which it owned a stake like Cloudtail and Appario to comply with FDI rules, over half a dozen new sellers have emerged on Amazon India. These sellers are now moving a significant part of Cloudtail and Appario’s inventory but delivery timeline remains a concern for the local arm of the Seattle-based e-tailer, as these items are taking 4-5 days as compared to 1-2 days earlier.
People aware of the matter said Sigma Online is one of the new largest sellers and there could be about six such alpha-sellers who would be critical for Amazon under the new regulations.
Amazon India country head Amit Agarwal is believed to have held discussions with senior executives over the new norms reducing Amazon’s day-to-day sales by 20-25% over the weekend. Since Friday, Amazon had to remove lakhs of products from its marketplace across core categories that drive sales from Amazon Echo products to smartphones to apparel.