Ecommerce major Flipkart is shutting down one of its seller services, called Smart Fulfillment, according to a note sent by the company to sellers who use the service. Under Smart Fulfillment, sellers allocate a separate space for their products at their own warehouse or place of business, which is linked to Flipkart's systems so these goods can be delivered faster. For this programme, Flipkart asks sellers to maintain their warehouses according to the company’s standards.

"In order to help you in reducing your cost of doing business and improving your order processing experience, we are discontinuing Smart Fulfillment," the note said. “The new programme through which they (sellers) can qualify for F-Plus enables sellers to make more efficient choices especially in labour cost. It brings down overall investment cost for them,” a person aware of the matter said. A decent number of sellers were using Smart Fulfillment, according to people briefed on the matter.”

With Smart Fulfillment set to be shut down, sellers can either store goods at Flipkart’s warehouses or handle logistics themselves. “After discussions with our sellers, we have found that Smart Fulfillment is leading to additional cost for sellers due to dedicated manpower, additional rented space, and third-party software to cut short the operational challenges,” Flipkart said in the note.

A seller said that though the move may help some sellers ship goods faster, they may also have to shell out more. He added "I will end up paying Rs 4-5 extra per order from now on for renting space in Flipkart's warehouse and their other services. For sellers moving small shipment volumes, that won’t be helpful