Jasper Infotech owned Snapdeal has suffered a loss of Rs 3,316 crores, up from the Rs 1,328 crores that it suffered the previous year. The loss has increased by over a 150%. Its revenue growth has slowed down by quite a bit. Its revenue has grown at 56% as compared to it previous year. It earned Rs 1,457 crores as compared to the Rs 933 crores earned last year. This is much lower than the 450% revenue growth that Snapdeal enjoyed the previous growth.
These numbers were obtained from the Registrar of Companies and it also includes the financial details of e-payment platform Free Charge. The company has been facing a lot of trouble in terms of the competition it is facing from Flipkart and Amazon. Flipkart and Amazon have pulled far ahead of Snapdeal in terms of the Gross Merchandise Value and the revenue and also the rate of revenue growth.
Snapdeal is also not valued as highly as Flipkart. Amazon is now said to be the biggest e-retailer in India and is bringing in more money from its head office in Seattle. Sanpdeal is said to be a distant third in terms of sales. Just like Flipkart, even Snapdeal has had a very very bad 2016. Although there was no change in the senior management or any mark down in the company’s valuation, Snapdeal has lost a lot of market share.
In order to address this, Snapdeal spent close to Rs 200 crores in unveiling a new logo along with a highly expensive media campaign on TV, social media and print media. Most of this was spent in September and October, which is the most important season for e-commerce companies. Snapdeal also modeled their company on the lines of Flipkart and Amazon, by creating a wholesale company by the name of E-agility Solutions Pvt Ltd to buy products and get good discounts on them for buying in bulk.
A lot of Snapdeal’s losses stem from their heavy investments in building long term infrastructure like investments in logistics and warehouses.