Will Myntra’s latest acqui-hire help its push for profitability?

On Wednesday, fashion e-commerce marketplace Myntra announced having acqui-hired Bengaluru-based logistic solutions company InLogg in an effort to expand its reach and improve customer experience. The move is an obvious push in the direction of profitability, as faster and more accurate delivery can cut down on expenses.

According to the press statement issued by the company, the entire InLogg team will be inducted into Myntra. Founded in 2015, InLogg has onboarded local and regional courier players in multiple states to provide a pan-India delivery network.

Empowering regional courier companies with technology, InLogg provides Saas for shipment lifecycle management, and mobile apps for pickup, delivery, returns, COD reconciliation, reporting, and analytics. The aim is to standardise the logistics fulfilment process.

Speaking about the acquisition, Ananya Tripathi, Chief Strategy and Planning Officer, Myntra, said:

With an 80 percent year-on-year growth, we are holding on a strong trajectory. The InLogg acqui-hire will help us scale while delivering great customer experience in Tier 2, 3, and 4 cities. It will also allow us to leverage local and regional players to enhance our reach, reduce delivery time, and develop a plug-and- play model which can be scaled in the future.

Ambarish Kenghe, Chief Product Officer, Myntra, has hinted that post the implementation of GST, the launch of value-added services, and continued focus on efficiency in FY18, supply chain management will be one of the areas where Myntra will continue to invest for the future.

Myntra—which hopes to be profitable this fiscal year—has been trying to cut down costs and increase margins. Cost- efficient logistics is a core factor in increasing margins for Myntra as well as Jabong, which it acquired last year. Although Jabong has shown positive economics, it is yet to show results in terms of profit—despite Myntra launching its successful private labels on Jabong’s platform.

In December 2016, Myntra CEO Ananth Narayanan had told YourStory that synergy between Myntra and Jabong had already begun in supply chain and sourcing and that they were working to improve technology by leveraging each other in search, apps, stack, etc. At the time, Ananth had said that only 30 percent of the supply chain was integrated with Flipkart.

“The plan is to run it quite independently. Myntra-Jabong has more synergy than Flipkart-Myntra,” he had added.

Myntra has been using its in-house firm Myntra Logistics for 70-80 percent of the deliveries, while the remaining 30 percent is served by the parent company, Flipkart’s logistic service Ekart, and a few third parties. With the SaaS technology InLogg provides, Myntra should be able to see a major change in scene.

Myntra recently launched an offline store in Bengaluru for its private label Roadster, highly empowered by AI to pave the way for a stronger omnichannel path. The entry of the InLogg team can be seen as another effort in this direction. Omnichannel is generally believed to be the most cost-efficient way of retail as it cuts transportation costs, especially in last-mile delivery.

InLogg is Myntra’s fourth technology-led acquisition. Myntra acqui-hired Cubeit, a Bengaluru-based tech startup in 2016. Another Bengaluru-based mobile app development company, Native5, was acqui-hired in 2015. Fitiquette, a San Francisco-based technology solution, which is a one-of-a-kind virtual fitting room, was acquired in 2013.