January 20, 2012 / 11:30 PM / 8 years ago

Amazon setting up first "fulfillment center" in India

SAN FRANCISCO (Reuters) - Amazon.com Inc is setting up its first “fulfillment center” in India as the world’s largest Internet retailer tries to break into the world’s second most-populous nation.

Fulfillment centers are giant warehouses that help Amazon and other online retailers store many products, ship them and handle returns quickly.

The fulfillment center is based in Mumbai, the biggest city in the country, according to job listings on Amazon’s India careers website.

Amazon “has an immediate opening for an IT Manager in our first Fulfillment Center based out in Mumbai, India,” one recent listing said.

Another recent Amazon job posting sought a “Stations Operations Manager” to work for the fulfillment center team in Mumbai.

Amazon was also recently looking for a financial analyst in Mumbai to report to a general manager and controller and help the fulfillment center operate more efficiently and predictably.

Amazon spent heavily last year setting up more than 10 new fulfillment centers in the United States. The company also lists fulfillment centers in China, Germany, Japan and the U.K. on its website, but currently lists none in India.

Fulfillment centers cost a lot to set up, so Amazon’s efforts to start one in India signals the company is serious about getting into the country’s $550 billion retail market.

“While it has been speculated that Amazon would be expanding internationally, it seems that the international expansion plans have been accelerating,” said Ben Schachter, an analyst at Macquarie. “Last year, they launched a country-specific site in Spain and now it looks like India could be next.”

An Amazon spokeswoman did not respond to emails seeking comment on the company’s plans for India.

Amazon has software development centers in Bangalore, Chennai and Hyderabad and a customer-service center in Hyderabad.

Shoppers in India can also buy products from Amazon websites in other countries and have the items shipped to them. But the company does not have a dedicated online retail business in India yet.

That has allowed e-commerce start-ups, led by Flipkart, to expand quickly in India.

“India is a tremendously large potential market for Amazon,” said Mahesh Murthy, a venture capital investor in India and founder of digital marketing start-up Pinstorm.

“In fact, from the metrics we see, Amazon currently gets more traffic from India than Flipkart does, even though the former has no formal presence in India,” he added.

Amazon already does a lot of business in India through its U.K. website, amazon.co.uk, because the company offers free shipping and handles customs for all books, music and DVDs bought from that site and shipped to India, Murthy said.

“But this would be significantly smaller than what Amazon could do if it came with a full offering into India,” he added.

Reporting By Alistair Barr; editing by Andre Grenon

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