For the purpose of selling directly to consumers without foregoing foreign investments, Some ecommerce firms including furniture portal Urban Ladder and garment retailers Zivame, FabAlley and Yepme, consider turning into single-brand retailers.
India had in November last year amended its single-brand retail policy to allow foreign-funded retailers that sell products under a single label to do so through both brick-and-mortar and online stores.
India allows 100 per cent foreign investment in ecommerce marketplaces but such marketplaces cannot stock or sell on their own; they are only allowed to lend their platforms for retailers to sell products.By re-modelling their businesses into single-brand operation, online retailers will be able to hold and sell their own inventory online without circumventing foreign direct investment (FDI) rules.
Experts said it makes sense for companies to leverage on their brand equity by going mono brands.Several online players do not consider this option though. Fashion retailers Limeroad.com and Voonik.com and online furniture seller Pepperfry said they want to maintain their marketplace models, allowing other retailers to sell products through their platforms.