Flipkart users soon will be able to order food via govt-backed ONDC: Report

Flipkart, a Walmart-owned e-commerce giant, is planning to enter the food and beverage (F&B) market through the Open Network for Digital Commerce (ONDC).

According to an ET report, Flipkart users will soon be able to order from a wide range of restaurants via the Flipkart app.

The report said talks between Flipkart and ONDC are reportedly in an advanced stage, with Flipkart executives meeting ONDC officials to finalize the deal.

What is ONDC?

ONDC was launched by the government in 2022 as an alternative to major ecommerce players like Amazon and Flipkart.

The initiative aims to provide more opportunities for small merchants and curb the dominance of big players.

In April, the government asked both Amazon and Flipkart to set up ONDC storefronts on their home pages to improve order efficiency and operations. This move is intended to enhance the network's operations and support timely deliveries.

How will Flipkart operate on ONDC?

Flipkart will operate on the customer-facing side of the ONDC platform, allowing users to order food while shopping for other items like apparel and home accessories.

The integration means Flipkart won't need a dedicated fleet of food delivery personnel or require restaurants to partner directly with them. Instead, ONDC’s sellers in the food and beverage category will be visible to Flipkart’s users.

What impact could this have on the market?

The introduction of Flipkart into the F&B sector via ONDC could offer significant benefits to users, including competitive pricing. Reports indicate that advanced stages of integration were completed in February 2024, though Flipkart has not yet made its food-ordering service active.

The new service will streamline Flipkart’s F&B operations, making it more cost-effective by reducing the need for additional delivery infrastructure.

ONDC has been steadily growing since its inception, recording 89 lakh transactions in May. The network has seen a diversification in its retail business, with categories like grocery, fashion, home, and kitchen gaining shares.

In May, the food segment accounted for around 20% of total retail orders, compared to 76% a year ago when food was the only category.

Other major companies, including Amazon, Ola, PhonePe, Reliance Industries, and Adani groups, are also exploring how to integrate their services with ONDC.