SWOT Analyis of Flipkart | Business Teacher
According to Pandey (2017), Flipkart offers numerous strong house brands. The “smart buy umbrella” contains thirteen brands that belong to Flipkart that include laptops, USBs and tablets. Furthermore, the organisation is India’s largest e-retailers, having grown both organically or through acquisitions (Chauhan, 2015). Flipkart’s brand awareness is high having invested in numerous advertising campaigns. Additionally, Flipkart has very efficient domestic and global delivery systems (Kumar 2017). The firm has invested heavily to ensure that it delivers products timely to various parts of India and the world through its E-Kart platform, which supports at least 4,100 couriers in the world (Chakraborty, 2017). When customers receive goods in time and conveniently, they become loyal consumers. Moreover, Flipkart has benefited from knowledge in resources and processes from established firms such as US’ Amazon (Bhosale & Shingate 2016; Chauhan, 2015). Moreover, the firm has invested in quality HRM practices, which ensure best employee relationship for increased output (Kumar 2017). Flipkart also has exclusive tie ups with big brand companies such as Apple, Xiaomi and Motorola, which assures them of a constant supply of merchandise (Bhosale & Shingate, 2016).
Flipkart’s distribution channels are limited and cannot be compared to those of its competitors such as Amazon and E-bay, which has been in existence for a longer (Kumar, 2017). Additionally, Flipkart invests in a lot of advertisement to improve and sustain its brand awareness, which is costly (Pandey, 2017). Although there is increased modernisation over the past years, Flipkart has not increased its sales revenue substantially (Bhosale & Shingate, 2016). Furthermore, there is uncertainty among investors regarding business continuity on the back of Flipkart’s plan to appoint Kalyan Krishmurth as the CEO (Pandey, 2017). As Pandey (2017) note, this uncertainty is further compounded by the fact that there are concerns that Tiger Global may be planning to sell its share to Microsoft. Therefore, Flipkart must invest in strategies that will boost sales volumes and maintain continuity to reinstate customer and investor confidence. Additionally, during the billion sales day, Flipkart offered discounts that were too large for the company, which compromised logistics (Pandey, 2017). Moreover, Flipkart’s website is prone to malfunction, where some products disappear before purchase (Bhosale & Shingate 2016). Website failures impact negatively on the sales of the company.
Flipkart can expand product categories by selling varieties of goods or services (Mishra & Pdhy, 2017). Indians, even those in the rural are now appreciating technology, and they are going digital. Most people have begun to shop online because of efficient deliveries. Besides, there is an opportunity to improve the supply chains, which increases overall organisational profitability and performance. Kumar (2017) notes that well-organised supply chains ensure products get to customers timely and in good conditions. There are many opportunities to grow business in developing economies. Growth rates in such places are high as well as their rates of technology innovations, which offer new opportunities for expansion (Sampat, 2015). Finally, one of the greatest concerns with online transactions pertains the security of both data and finances (Dai, Forsythe & Kwon, 2014); Flipkart could tap into these potential areas through research.
Market competition by international players such as Amazon and E-Bay is challenging to Flipkart’s sustainability (Kumar 2017). Every competing company is fighting for a bigger market share to make better sales. Local competitors also such as Tolexo and Snapdeal are also threats to the company. Additionally, Government regulations such as taxes affect Flipkart operations (Pandey, 2017). The new GST (Good-and-Sales-Tax) bill that was recently introduced in India has increased the cost of online sales, which might increase the cost of doing business online and a shift to offline transactions (Garg, 2014) since the costs will be transferred to consumers. Just a week after the GST bill was rolled out; many online businesses sold their goods on discounts to clear stock before the bill was implemented. Flipkart, whose main outlet is online sales, may see its revenue drop drastically if consumers opt to purchase goods offline due to the increased cost.