Flipkart-owned fashion retailer Myntra is working with a new exclusive seller Sane Retails to comply with a government regulation for e-tailers that directs a single merchant to not have more than 25 per cent of overall sales for any ecommerce platform.
Myntra's association with Sane Retails is largely for selling private brands of the company, which constitute 22-23 per cent of its sales. Sane Retails is emerging for Myntra as what is called as an alpha seller in e-commerce lexicon. These sellers are the primary drivers of sales for any e-commerce company working closely with the platform's fulfilment centres and benefiting from their logistics expertise to ensure adequate inventory and faster delivery.
Myntra has been reducing its dependency on Vector E-commerce, its largest vendor, to comply with the Department of Industrial Policy & Promotion's (DIPP) Note 3 issued last year. A majority of private labels is being sold through Sane retails since its own brands now contribute a significant amount of business.
Traditionally, Vector Ecommerce contributed over 80 per cent of Myntra's overall sales. In fact, Myntra executives were also on the board of Vector E-commerce. To reduce its exposure to one large single vendor clocking most of the sales, the concept of alpha sellers was brought in which saw Tech Connect Retail selling more on the platform, reducing Vector Ecommerce's influence on Myntra as a seller.