Walmart-owned e-commerce giant Flipkart purchased its parent firm's Indian cash-and-carry stores on Thursday ahead of launching its own digital wholesale business, the latest salvo in the frenzied battle for the country's massive online market.
The Best Price wholesale chain has been run by the US retailer since 2009 and caters to more than one million members -- mostly family-run retailers that serve as the backbone of India's grocery sector.
The purchase sets the stage for the August debut of Flipkart Wholesale in the latest effort to bring these smaller stores into the digital mainstream.
"We will now extend our capabilities across technology, logistics, and finance to small businesses across the country," chief executive Kalyan Krishnamurthy said in a statement.
Flipkart's move follows in the footsteps of competitors Amazon and JioMart, a subsidiary of the Reliance conglomerate owned by Asia's richest man Mukesh Ambani.
After spending years battling local mom-and-pop shops for customers, the online retailers are now trying to work hand-in-hand with the smaller stores dominating India's towns and hinterlands to bring them online.
The war for a larger share of the e-commerce sector gained prominence when Ambani launched JioMart in May.
Reliance set up digital payment systems linked to inventory management in a bid to merge e-commerce and offline retail.
"The competition in this space is... expected to increase significantly in the near future with the new (Flipkart) venture competing head-on with Amazon and Reliance JioMart," TechSci Research consultant Shweta Gupta told AFP.
Flipkart did not reveal the deal's financial details but said Best Price employees would join the Bangalore-headquartered firm as part of the agreement.