Working with Flipkart for more than 3 years was a career rewarding and an enjoyable experience for me. I not only got exposed to how eCommerce works in reality but also was able to understand the potential of the eCommerce industry in the future.
I think it is important to explain what is Flipkart ahead of making you understand how Flipkart works.
What is Flipkart?
Flipkart is one of the first companies that gave life and revolutionized the eCommerce industry in India. Sachin and Binny Bansal led Flipkart has become India’s largest e-retailer for consumer goods.
Founded by the two brilliant IITians namely Sachin Bansal and Binny Bansal, Flipkart continues to scale its presence in the Indian online market.
Almost all are shocked by the rapid growth of Flipkart. One of my senior colleagues who had worked with the company since 2009 told me once in a casual talk that Flipkart in 2009 used to receive hardly 200 orders per day.
There are now {2012} more than 4 lac orders being received by the company on a daily basis. Isn’t it shocking? See the difference Flipkart made in just three years of time. It is shocking since there was too little trust among Indians for online shopping.
How does Flipkart work?
We must learn all components in order to understand the working mechanism of Flipkart. Hopefully, it could prove beneficial if you plan for launching your own eCommerce portal like Flipkart.
Market Research
Almost all companies have a market research department to sense the trends, identify and analyze the needs of its target market and Flipkart is no different.
The market research team of Flipkart is responsible for identifying in-demand products and processing their findings to the next team that handles the procurement process.
The company also uses independent agencies to attain valuable customer data.
Procurement
Many people when they happen to meet me or send mail queries ask how does FLIPKART procures inventory from its suppliers? My reply is that Flipkart sources inventory in a similar fashion as a retail shop does usually from a wholesaler.
Flipkart has a specialized procurement team of people whose work is to source and make contracts with the right suppliers all over the country. They have their own standards to select suppliers that suit the company requirements.
In 2013, Flipkart launched a marketplace to invite third-party sellers to sell their products. A separate team called the marketplace team was created to help third-party sellers list their products on the Flipkart portal.
Logistics management
Flipkart uses inbound logistics of suppliers to receive inventory in its warehouses where it is properly shelved.
The company also uses its own logistics called eKart FSD {Flipkart Self Delivery} and third-party logistics service providers such as Bluedart, eCom, etc to ensure product delivery to the customers.
Warehouse management
There are around eight largest warehouses owned and operated by Flipkart in the eight largest cities such as Bangalore, Chennai, Delhi, Mumbai, etc.
Once inventory brought from suppliers reaches a warehouse, it is kept on shelves. A specific number called the put-list number is generated while each product is put on a warehouse shelf.
Catalog management
The warehouse department shares inventory bills with the marketing team that sets the listing prices for the products.
The prices are in turn shared with the catalog management people who eventually upload product pictures, prices, and product features on the Flipkart portal.
Delivery management
When customers place their orders on the Flipkart website or mobile application, request flows through FLO{Company’s ERP software} to the warehouse department.
The warehouse staff checks product availability in the warehouse in proximity to the customer. In case there is no product availability, the request is forwarded to another warehouse.
Once found, the product is picked {picklist number is generated} from the shelf and moved to the packaging section where the condition of the product is checked and eventually packed. This is called dispatch state.
The packed product is taken to the mother hub where delivery executives await its arrival. These executives ensure the final delivery of the product to the customer while getting the signature of customers on customer acknowledgment paper.
It’s to be noted here that Flipkart uses its own delivery system for accessible locations while third-party to deal with non-accessible places.
Customers are contacted upon the arrival of their orders and an amount is received from them if their orders were based on COD{cash on delivery}