Amazon To Cut Discounts To Achieve Profit By 2019

Amazon, the global ecommerce company has been quietly trying to reduce losses to reach its target of getting on to a path to profitability by 2019. The Indian unit of the global ecommerce and cloud computing company will try to cut losses without sacrificing sales growth.

A news daily reported Amazon, which has been trying to achieve dominance in the Indian ecommerce market space, has been trying to reach its target of getting on to a path to profitability by 2019. According to sources close to the matter, Amazon came up with the ‘Get Fit’ initiative to cut packaging costs, introduce more automation in warehouses and deliver products more efficiently.

The initiative was announced around the time Jeff Bezos, founder and CEO of Amazon committed an additional $3 billion towards expanding the Indian business in June 2016. This round of investment was in addition to the $ 2 billion investment Bezos had announced in July 2014. Get Fit along with the Get Big program are the two biggest initiatives at Amazon India which are about making the company the largest online retailer in the country.

The company also got the Indian Government’s approval to invest $ 500 million in the food retail sector in July. It was also reported last month, Amazon might partner with online grocery retail startup Grofers to get a toehold in the sector. Amazon India, till date has spent around $ 2 billion to gain the upper hand in the biggest unconquered Internet market in the world. But, Amazon India’s loss soared to Rs. 3,572 crores in the financial year 2016 while the company reported a revenue of Rs. 2,275 crores.

At present, Amazon is fighting against homegrown ecommerce giant Flipkart which is backed by Tiger Global and recently by SoftBank. According to sources, Amazon will match Flipkart’s efforts at all levels despite India being one of the biggest loss drivers in Amazon’s international business. An Amazon spokesperson said the company is committed to investing in India for a long period of time with the vision of transforming how India buys and sells.