How do E-commerce companies like Flipkart, Jabong, and Amazon make money?

All these sites are multi seller websites who are selling their products via these eCommerce websites. These websites in return earn money in the form of commission from all merchants who are associated with these websites.As all these eCommerce ventures are successful now, they are getting paid for putting advertisements on their websites, that is the another way for them to earn money.They are also sponsoring events to bring more customers to their websites where they are earning extra money .Hope this helps!

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When you are a seller in an ecommerce company, they get your inventory and there is something called OS/DS.. OS is Own Shipping and DS Is Drop Shipping When You sign up as a seller in flipkart or snapdeal they will sign u into Dropship metod wer u wil put price for your Product and they will state their own price later.. Like u put an led tv for 24000/- and they will state for 25900 and from 25000 you still pay a 5.75% Avg Referal fee also.. sometimes they put also for 22500 and still give you your money as stated..they have the freedom of pricing.But Amazon does not do this though you are a fulfilled seller.and these companies know wer they earn and how much they earn and how much they can Lose Per day, Every Ecommerece Company Lose a Part Of money but not the complete money..It makes sense that they don make money but one should also know that these companies are also not run on LOSS..they reinvest their profit from one catagory to another , just to win the competancy..

Currently most of the big e-commerce websites are making no profits, they just are focusing on developing their customer base and market for future. As long as the question of funding their advertisements is concern they they have sponsor to do that, for example recently Snapdeal raising $500 million from Japan’s SoftBank, Foxconn of Taiwan, and China’s Alibaba, valuing the company at about $5bn . So basically they just are increasing their market value instead of making profits because in India it just is the beginning of online shoping market, 95% market is yet to be discovered.

Create an Ad, attract 100000 people, have 5000 in-stock, in 5 minutes you sold 5000 products. Multiply this by 1440 (i.e., minutes per day). Create a attraction, attract visitors to website, show what you offer to them, convert visitors to customers, make them willing to share currency with you. Exchange your offer with currency. Receive payment. If you have a system that does this in 5 - 10 minutes, you will be billionaire. But not easy ;pReady to occupy - ECommerce Websites. Features : Supplier management, vendor management, product catalog, ERP, E-Billing, Mobile payments & Much more. Contact :

The media is replete with stories of internet startups that have multibillion-dollar market capitalizations but have not yet earned a single penny. Some large companies are on the internet as a matter of necessity; for some small ones, the internet itself is a necessity. Reality lies in the shadows, somewhere in between. Many firms do make money online and have busy e-commerce sites. People are no longer conservative when purchasing over the Internet. The financial rewards of doing business transactions over the Internet are growing faster than ever. You will need to integrate e-commerce into your overall operations, marketing and sales strategy to make it lucrative. Failing to do so will mean that your e-commerce implementation will have wildly fluctuating results. E-commerce is a totally new business channel and has to be viewed as such; it’s not simply an electronic brochure of your company or a simple marketing function. It has to be weaved into the very fabric of your company. All your current processes and applications have to be closely tied to your online store. For the entire online buying process to go through fruitfully, your marketing, accounting, purchasing and inventory, shipping, customer service and after-sales support have to find harmony with the technological implementation. http://shop2grab.com/

I found a discussion on Awaremonk which says this- http://awaremonk.com/user/singlePost/55303 A business model is complete only when the company posts cash profit and becomes self-sustaining. Flipkart and other e-commerce companies are surviving on private equity money. None of them are profitable and nowhere close to being profitable in the near future. I even read it someplace that a Flipkart executive made a statement saying "making losses was a conscious decision. Profitability is not a focus area. Its a strategic decision. We can be profitable from today if we want. We can stop investing in one area and start making profits; its definitely possible. But we dont want to remain as a small profitable company.” I don’t expect a company having such executives can actually run, either cut costs removing high intellects like these or figure out a sustainable business model.

Hi Tanujeet,None of them are making money now. Many of the so called big players in the ecommerce are still not making money. Here is what’s happening.All these ecomemerce companies are busy acquiring customers. They spend huge on the marketing, branding, discounts, freebies, offers etc. All these are to lure the customers their website. And then engage them to buy more from these sites. Unfortunately, these players could only convince customers in india about the discounts and freebies they offer, and couldn't inject brand loyalty. So the spend to acquire still continues, as these big companies still dont have a clue on Indian hectometer behavior.Once the monies are over, to acquire customers, they are forced to cut down on discounts, unnecessary spends and start focusing in profits. This is called consolidation. Few players from this crowd will survive ( those that can still raise money). Others will either be acquired or will shut down. When these few companies distribute the market share, the real game of earning will start. Since the customers are already used to online buying, and the options of discounts are less, they will stick to the best service providers and they will not mind paying whatever it takes for the products and services.

Its just a myth that they do not make money. Major part was they make money by affiliate with other companies. Flipkart is almost similar to amazon in structure. Obviously, they do make money because a website such as flipkart could not exist without any profit at all. Basically, they make money by letting other people sell their products and they could post some relevant advertisements. These advertisements could drive them profit besides of the percentage they obtain from the sellers or products that were posted to the site. Although there are some people who are telling that Flipkart lost over 9 million INR, but this lost might be caused by some other reasons. Funding and Flipkart have become almost synonymous. The e-commerce giant made massive headlines yet again when it raised $1 billion from investors making it the largest possible investment in the history of Indian e-commerce to date.Co-led by existing investors Tiger Global Management and Naspers, Singapore's sovereign wealth fund, GIC, Accel Partners, DST Global, ICONIQ Capital, Morgan Stanley Investment Management and Sofina also participated in this latest financing round. Beyond the balance sheet, Flipkart has a threat of rival Amazon looming large and the seriousness is obvious to all and sundry. "Amazon's entry in India last year increased competitive intensity in the Indian e-tailing space. The global leader has invested in steadily adding on categories, increasing its vendor base and building back-end capabilities like logistics and warehousing. It has stepped up its pace through mass media campaigns and faster delivery services, thereby establishing itself as a serious contender in the Indian market and intensifying competition," notes Pragya Singh, Associate Vice-President, Retail at Technopak Advisors, a market research firm.