by Apparel Resources News-Desk
12-August-2019 | 1 min read
Online marketplace Paytm Mall has announced that it is shutting down its warehouses and is adopting a hyperlocal model in order to comply with FDI in e-commerce norms and reduce costs associated with logistics.
The move is going to help the country’s third largest e-tailerin multiple ways!
While it will significantly reduce the cost with the company not having to own and operate its own warehouses, the sellers on the platform will use local courier services for delivery which will further bring down the time and cost of deliveries.
Substantiating further, Rudra Dalmia, Senior VP and CFO, Paytm Mall said “The cost of acquiring sellers has gone down as most of these sellers were already accepting payments using Paytm.”
Valued at US $ 3 billion after eBay agreed to buy a 5.5 per cent stake in the firm for US $ 165 million, the latter is aiming to be EBITDA positive within 2 years.
In the present financial year, Paytm Mall is eyeing a GMV of Rs. 17,000 crore.
“In 2017-18 we were doing a course correction. In this business, one can only be profitable if one becomes a true marketplace and does not follow an inventory-based model because the latter comes with the baggage of high costs. Both our partners, eBay and Alibaba, are making money,” asserted Dalmia.
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