Amazon eyes first India offline store in City

Bengaluru is likely to get the world’s third offline or physical store from Amazon, the $89-billion world’s largest e-commerce player. According to sources close to the development, the company has initiated negotiations with realtors in the city.

The sources told Deccan Herald that Amazon is scouting for a prominent location in Bengaluru, where its India operations are headquartered.

E-commerce pioneer and leader Amazon is no stranger to offline operations. In February this year, the company opened its first physical store in the campus of Purdue University in West Lafayette, Indiana, and called it a “customer order pickup and drop-off location”. Subsequently, it expanded operations to one more location in Purdue.

According to the company, the centres will allow Purdue students and others to collect orders of textbooks as well as other goods, and make returns. While there are no products available for purchase at the pickup point, the two stores are viewed differently from other pickup points of Amazon at railway stations and post offices in Europe, and nearly 1,000 mom-and-pop stores in India, since the Purdue stores are directly managed and staffed by Amazon. Paul Ryder, Amazon vice-president of media and student programmes, has said the company planned to open more centres at other universities.

Sources close to an institutional investment firm, which is into retail realty facilities, said Amazon recently approached it for opening such a facility in Bengaluru.

“We have received solid queries from the company to start a store in Bengaluru which is not yet finalised. The discussions are heading in a positive way and it will be clinched soon. Our company has been receiving queries from other top eCommerce players as well to start their offline stores in the city,” said the source.

When Deccan Herald approached the India spokesperson of Amazon, she declined to comment. “We do not comment on the future plans of the company as a policy,” she said.
In the past, The Wall Street Journal has reported about Amazon’s plan to start an offline store in New York near the Empire State building which would function as a mini-warehouse with limited inventory. In July, the Silicon Valley Business Journal reported about similar plans by Amazon for a 11,600-sq ft building and grocery pickup area at Sunnyvale, California.

In an interaction with Deccan Herald during his first visit to Bengaluru in September 2014, Amazon founder and CEO Jeff Bezos stated that the company’s growth in India was unprecedented. As part of that visit, the Amazon CEO formally declared the company’s commitment to invest $2 billion in India. Amazon’s head of international consumer business, Diego Piacentini, recently stated that India is the second biggest investment country for the company after the US and will be key to Amazon’s future success.

According to Morgan Stanley data on gross merchandise value (GMV) as of March 2015, Amazon India had a market share of 15 per cent, and came in third in the eCommerce space behind Flipkart (44 per cent) and Snapdeal (32 per cent).