Flipkart to cut vendor fees in bid to attract sellers, goods to get cheaper ahead of festive season

Sellers have gravitated to Amazon, and Flipkart will be looking to reverse this trend by pruning their margins and foregoing commission.

Flipkart is set to revise its fee structure on Friday, a move that could make products sold on its platform cheaper in the run-up to Diwali. The holiday season is a lucrative period for retailers, as consumers shop more, cashing in on the discounts on offer. Both Flipkart and rival Amazon had offered steep discounts as a part of its sale commemorating Independence Day.

Flipkart is mulling a change to its seller policy by dropping a ‘fixed fee’ across categories on its platform. This would eliminate a fee on pre-orders made on products. It will also cut back on commissions on categories like fashion and wearables.

The changes come into effect on goods across all price points. In April, the e-tailer had reduced the fixed fee and also its commission exclusively on low-priced goods. Flipkart will forego commission in the range of Rs 5 to Rs 12 on goods belonging to different price points and categories.

For goods priced between Rs 500 and Rs 1,000, the fixed fee is being reduced to Rs 15 from Rs 20 previously. The difference may be small, but the impact on profits could be significant as a large chunk of orders falls within this price bracket. The fixed fee on goods priced at Rs 1,000 and above will be slashed from Rs 40 to Rs 30 under the new regime.

A spokesperson for Flipkart told the Times of India that new policy was being adopted to incentivize sellers on its platform. With the e-commerce space becoming ever more competitive, a wider bouquet of goods becomes all the more important.

Sellers have gravitated to Amazon, and Flipkart will be looking to reverse this trend. Bengaluru-headquartered Flipkart claims to have 1 lakh sellers, almost a fourth of Amazon’s 3.8 lakh sellers.

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