Festive Sale: Both Amazon and Flipkart are eyeing to cross Rs 90 thousand crore in this sale. But how will they do it with huge discounts?
Festive Sale: This is the festive season in India. Meanwhile, Flipkart and Amazon are busy doing business worth crores. A question must have come to mind that how are these companies making profits even after giving discounts up to 70 percent. If we talk about now, Amazon and Flipkart together can make sales worth Rs 90 thousand crores. Actually both of them follow the policy of simple business. Plus a little economics is helping these companies here. So let us explain to you about their funds in simple language.
First understand the business policy
- Flipkart and Amazon are online companies i.e. they do not have any stores. Profit starts from here. And the product remains until it is sold.
- If there is no store, no shop then the expenses of both the companies are reduced. Like an office benefits from work from office.
- Delivery is done directly from Wholesaler . This saves these companies from store costs. Store cost plays a big role in profit.
- There is no chance of the product getting damaged . Now when you are not storing it, there is no chance of the product getting spoiled.
- Offers are made to wholesalers in bulk and they get huge discounts. At the same time, companies give offers worth lakhs to the wholesaler. Due to this, Wholesaler gives good discount to these companies.
- The responsibility of damage lies with the courier service . Companies give the responsibility of damage to the courier service. In which any damage due to wear and tear can be avoided.
Now let’s talk about economics
Economics looks tough, but if it is explained in simple language, then there is nothing easier than this. Actually companies work on demand and supply. Suppose, if the demand on a product is high, then the company gives maximum discount on it, so that the level of demand remains maintained. And then at a point they reduce the supply, due to which a marginal increase in the rate is seen. But it is not less than a lakh profit for the companies.
