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Flipkart to Cut Merchant Commission Fee, Focus on Advertising Unit

In a relief for existing and aspiring merchants on e-commerce portal Flipkart, the company has decided to do away with the commission it charges to sell products on its website, an ET report has said. In a bid to encourage more sellers to join its list, the company has said that it will bring the commission fee down to zero. Currently, Flipkart charges its merchants a marketplace fee, which is a percentage of the selling price of the product inclusive of a selling commission, a closing fee and shipping charges.

It is the selling commission that Flipkart will do away with. The rest of the ‘marketplace fee’ will continue as it is. The company aims to have one lakh merchants by 2015-end, up from the current 30,000.

Moreover, Flipkart is also planning to focus on the growth of its advertising unit. For this, the company is planning to encourage its merchants to advertise on its website. Flipkart’s co-founder and CEO Sachin Bansal supervises the advertising unit. Flipkart forayed into the advertising space earlier this year, in a bid to make its place in the vast high margin business arena to boost profits before a public listing.

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