Was Amazon really interested in Future Group?

American e-commerce retail giant Amazon has won the initial battle against Future Group. The latter cannot sell its assets to Reliance Retail for the time-being. Amazon claims that Future violated the agreement it had earlier signed with the e-commerce giant, where it was supposed to get the right of first refusal to buy out the beleaguered retailer. But was Amazon really interested in buying out Future Group in totality?

Operational issues had tainted the deal with Amazon right from the day it was signed. A former senior Amazon executive, tells BusinessToday.In that the deal was on the brink of collapse. Amazon picked up a 1.3 per cent stake in Future Retail last year through Future Coupons, in which it bought a 49 per cent stake. "The deal was aimed at building the retail business together. Amazon was to bring in technology and Future supply chain efficiencies and inventory. The stores are to be used as fulfilment centres. The arrangement is facing a host of operational challenges. When the Amazon delivery staff goes to Big Bazaar stores to pick up inventory, they are made to wait at the cash counter as stores prioritise their own customers. The aim was to do over one lakh deliveries a day from Big Bazaar stores but they don't do more than 10,000-15,000," the former executive adds. The US retailer, he says, was happy to exit considering the investment was not reaping fruits.