Amazon Acquires Indian Startup Perpule to Boost Offline-to-Online Retail

Amazon has completed the acquisition of Perpule, an Indian startup focused on assisting traditional brick-and-mortar stores in establishing an online presence. This move represents Amazon’s continued effort to gain traction in India, the world’s second most populous country, where physical retail still accounts for over 95% of all sales.

Details of the Acquisition

The e-commerce giant announced the acquisition of the four-year-old Perpule on Tuesday. According to a regulatory filing, Amazon Technologies invested $14.7 million in an all-cash transaction to secure the Indian startup. An additional $5 million is anticipated to be allocated as compensation for Perpule’s employees.

Perpule had previously secured $6.36 million in funding, as reported by Tracxn. The company provides a mobile payment solution – a point of sale (POS) machine – to retailers, facilitating digital payment acceptance and integration with various mini-app stores like Paytm, PhonePe, and Google Pay within India.

Perpule’s Technology and Amazon’s Vision

“Perpule has developed a cutting-edge, cloud-based POS system that empowers offline retailers in India to optimize inventory management, streamline the checkout process, and enhance the overall customer experience,” stated an Amazon spokesperson.

“We are thrilled to welcome the Perpule team and leverage their expertise to create growth opportunities for businesses of all sizes in India, simultaneously elevating the shopping experience for Indian consumers.”

Perpule’s Evolution

Established in late 2016, Perpule initially focused on reducing wait times in large retail chains like Shoppers Stop, Spar Hypermarket, and Big Bazaar. However, as Abhinav Pathak explained in a recent interview, this initial product lacked scalability, prompting a strategic shift for the company.

The Bangalore-based startup, backed by investors including Prime Venture Partners, Kalaari Capital, and Raghunandan G (founder of Zolve), subsequently expanded its product line. This included the launch of StoreSE, a platform enabling businesses to manage group orders efficiently.

Geographic Expansion

In the previous year, Perpule broadened its reach beyond India, extending its services to Southeast Asian markets such as Indonesia, Malaysia, Thailand, Singapore, and Vietnam.

Amazon’s Strategy in India

Amazon has been actively collaborating with physical stores in India to bolster its delivery network, expand warehouse capacity, and even utilize existing inventory to drive sales.

This move into physical retail aligns with the strategies of competitors like Flipkart and Reliance Jio Platforms, which have collectively raised over $20 billion, as they also strive to dominate the Indian market. The acquisition of Perpule follows Google’s recent investment in DotPe, another startup offering similar solutions.

The Significance of Neighborhood Stores

India’s ubiquitous neighborhood stores, often family-owned and operating with minimal overhead, present a unique challenge to large retailers. With over 30 million such stores nationwide, they offer unparalleled delivery speed and often boast superior economic efficiency compared to their digital counterparts.

These stores provide a wide variety of goods and are deeply ingrained in the local communities.