Amazon India, the domestic arm of the global ecommerce major Amazon, is in discussion with Burman Family Holdings, the strategic investment arm of the Burman family, which owns consumer company Dabur and Infosys’ co-founder Kris Gopalakrishnan’s family office for creating JVs as merchant sellers that will act as sellers on the marketplace. The new entity is expected to be similar to Cloudtail India, the largest seller on Amazon, which is a 100% owned subsidiary of Prione Business Services, a joint venture of Infosys co-founder Narayana Murthy’s Catamaran Ventures and Amazon Asia.
Satish Meena, Senior forecast analyst at Forrester Research, said that “Cloudtail has been doing well. These ventures help Amazon comply with the DIPP norms and exercise greater control over inventory, manage customer experience and comply with the regulations of GST for tax collection at source”. He further added that “In March 2016, the Department of Industrial Policy and Promotion (DIPP) capped the sales originating from a single vendor on a marketplace at less than 25%. With GST coming into effect it would be easier to trace the sales to the entity and hence creation of another entity will aid the marketplaces in complying with the norms”.