This is what Flipkart is doing to double its growth pace by 2017 end
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As per reports, Flipkart will be infusing minimum fresh capital in the business unless a new investor comes along. "The focus is back on growth for which savings from cost cutting will be deployed,” one of them told ET.
Flipkart is said to be lowering its burn rate by 5-10% every quarter since the beginning of 2016, and wants to sharply accelerate this pace.
The company plans on generating extra money through operational efficiencies and drum up revenue from units such as advertising and logistics arm eKart.
According to experts, the emphasis on spending curbs and expansion could be aimed at making Flipkart a more attractive proposition for investors.
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Until last year, the burn rate was a measure of negative cash flow that companies used as a weapon to outgun their rivals to win markshare and pump up growth. The strategy worked as investors were eager to fund companies, especially in the ecommerce sector. However, with the investment environment shifting from expanding at all costs to sustainable growth and profitability, companies have been left with very little option but to burn less money.
Flipkart said that even though, the company spent less on marketing and logistics that its rivals, it still was the leader during the festive season.
The e-commerce is believed to be in talks with
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