Amazon Appario Retail: Amazon Appario Retail seller revenue rises 9% to Rs 15,000 crore, profit rises 53%

Appario Retail, the biggest seller on Amazon India, which the retailer said it would close in a year, saw a 9% increase in operating revenue in FY22 to Rs 15,915.6 , or nearly $2 billion, according to regulatory filings from the Tofler business intelligence platform.

Appario Retail, which is hosted by Frontizo Business, a joint venture between Amazon and Patni Group, also reported that profits increased by 53% to more than Rs 82 crore in the 2022 financial year.

The figures, drawn from the bulk of the order volumes it enjoys on Amazon India, reveal the scale of Appario Retail in the market. The main source of income for the affiliate is the sale of goods on the market. Appario’s parent company, Frontizo Business, which provides customer support services to Amazon India, earned self-contained operating income of almost Rs 55 crore in FY22 along with a first profit of Rs 5.6 crore, according to regulatory documents.

On October 31, in a joint statement, Amazon and Patni Group said that the joint venture had been renewed, but Appario would cease to be a seller on Amazon India and Amazon India Business – the wholesale platform – from a year here. ET had reported that the Amazon-Patni joint venture for Frontizo had been renewed for three years.

Existing standards do not allow an entity operating an online marketplace and its group companies to hold shares in any of the platform’s sellers or have control over their inventory.

This is the second time that Amazon has shut down one of the biggest sellers in the Indian market in which it had a stake. Following the tightening of rules on FDI in e-commerce, Amazon was forced to reduce its stake in the parent entities of Cloudtail and Appario Retail from 49% to 24%.

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Amazon acquired 100% of Prione, Cloudtail’s parent company, earlier this year, after which it shut down Cloudtail.

Appario Retail’s largest expense was the purchase of inventory, spending Rs 14,470.90 crore during the reporting period compared to Rs 13,670.60 crore a year ago. Employee spending fell by around 30% to nearly Rs 41 crore in FY22.

Amazon established the Frontizo joint venture with Patni Group in 2017. Appario Retail has grown as a seller in the Amazon India marketplace since then and has become one of the biggest sellers, dealing in categories ranging from electronics to accessories and working with brands such as Xiaomi, Pop and Fire-Boltt.

While Frontizo will continue its services, Appario Retail may offer seller onboarding services on Amazon India, ET had reported. This is similar to Prione’s core business.

Before closing its activities as a seller, Appario Retail is likely to transfer its key activities to other seller companies on Amazon India. ET reported in August that several new retail companies have taken over Cloudtail’s business on Amazon, and they have one common thread: They’re all led by former Cloudtail and Appario Retail executives.

ET reported in September that Cloudtail recorded a 15% increase in revenue to Rs 19,076 crore, while its losses increased 2.8 times to Rs 522 crore in FY22.

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