Daraz.pk: Online Marketplace’s Value Chain

• Published in: Asian journal of management cases Vol. 16; no. 1; pp. 21 - 37
• Main Authors: Jajja, M. Shakeel S., Jat, Mohsin N.
• Format: Journal Article
• Language: English
• Published: New Delhi, India SAGE Publications 01.03.2019
• Subjects: international sourcing; Online retail logistics; supply chain monitoring; demand hikes; vendor managed inventory (VMI)
• ISSN: 0972-8201; 0973-0621
• DOI: 10.1177/0972820119825976

This case study provides an understanding of the channels through which orders at an online retail platform are fulfilled. Daraz.pk, the pioneering and leading e-commerce platform in Pakistan, started in 2012 as an online fashion retailer and evolved into a general marketplace for brands selling items ranging from electronics to home appliances to fashion. The case study is built around the decision regarding how to engage international brands in the wake of increasing local completion and the potential entry of some established international players. Highlighting the decision’s implications on logistics (and vice versa), this case study exposes various important trade-offs between in-house inventory and vendor-managed inventory. Through the example of a sales-day event conducted by Daraz, this case study also brings to light various strains that logistics could potentially face because of demand hikes and the steps that could help in managing a situation like this.