Tata Group to be the ‘Alibaba’ of India?

Tata Group to be the ‘Alibaba’ of India?

MUMBAI: The multiple investments made by its chairman emeritus Ratan Tata in e-tail and the steep rise in the e-commerce industry seems to have inspired the Tata Group too, which is now reportedly planning a big entry into the e-commerce space with a marketplace-based model.

 

The Economic Times reported that the site will be headed by its subsidiary Tata industries and that Tata is modeling its business on Tmall.com, which is the marketplace in the Alibaba Group.

 

The new marketplace business, modelling on Alibaba's Tmall.com, would allow third-party sellers on the platform. It would help generate revenues by charging a fee or commission from merchants, who will use the platform.

 

The yet-to-be-named venture is likely to be rolled out in 2015, and will initially showcase Tata's existing retail chain brands such as Westside, Croma and Star Bazaar. Tata is also planning to tie up with its partner Zara, which only sells online through its own sites.

 

It will also allow other merchants to sell alongside Tata's various units. The group has already reportedly begun enrolling vendors and hiring people, the report added.

 

Tata already has a substantial presence in real-world retail, including joint ventures with Britain's Tesco, Spain's Zara and coffee chain Starbucks. Last month Ratan Tata, chairman emeritus of Tata Sons, bought a stake in Snapdeal and online jewellery retailer Bluestone.

 

India's e-commerce market has been booming in recent years with market leader Flipkart clocking a valuation of $7 billion in a July funding round when it raised $1 billion from a clutch of existing investors and a day later, Amazon announced plans to invest $2 billion in India.

 

Also, India's online retail business is expected to surge to between $19 billion and 38 billion, from about $2.3 billion in annual sales now. Enticed by the potential, other business houses like Reliance Industries and Aditya Birla Group have reportedly been hinting at forays into the e-commerce space but have not revealed any concrete plans so far.