eKart sets up logistics deal with Paytm

eKart, the logistics arm of Flipkart, will soon handle logistics for Alibaba-backed Paytm (One97 Communications), in line with the company’s plans to open up its services to third-party merchants. The Paytm partnership is the latest one struck by eKart as it seeks to build a large third-party business. eKart had earlier signed on with online fashion store Jabong to handle its logistics and was in advanced talks to close a deal with ShopClues (Clues Network). Besides, the company was also planning to pilot an inter-city customer-to-customer courier service called eFlash. “We have created a network of national and local logistics partners who empower sellers to ship to customers across the country in an efficient and effective manner. eKart will join the network along with Delhivery, GoJavas, Blue Dart and many more,” said Sudhanshu Gupta, vice-president at Paytm. Myntra, which was acquired by Flipkart for $330 million in May 2014, has already been using eKart’s logistics services since September 2015. eKart’s logistics service for third-party etailers compete with well-funded e-commerce-focused logistics firms such as Delhivery (SSN Logistics), Ecom Express and Dotzot, the e-commerce focused arm of DTDC Express. Traditional logistics companies such as Gati, Blue Dart Express, Safexpress and Drive India Enterprise Solutions are all adding e-commerce verticals to their existing lines of businesses. Online retail sales could touch between $48 billion and $60 billion by 2020 from $4.47 billion in 2014, according to an April 2015 report by financial services firm UBS Group AG. A full-fledged roll-out of the service to other e-commerce companies will require Flipkart to ramp up its infrastructure substantially.