The online retail partnership means Flipkart will source iPhones directly from Apple instead of from third-party suppliers, which it has relied on in the past. The deal will ensure Flipkart earns a higher margin on every sale, but likely fewer discounts for customers.
Apple has also struck a deal with Indian e-commerce company Infibeam to directly sell its iPhones, but the partnership with Flipkart includes plans to sell iPads and Macs as well.
Apple does not yet have a license to sell products directly to consumers in India, which has led to buyers going through third-party retail stores to get hold of the company's flagship phones. Traditionally, Flipkart has also used third parties to sell Apple products through its online marketplace, often with heavy discounts in order to compete with offerings from rival e-commerce giants like Amazon India and Paytm.
Despite the potential loss of some customers looking for discounted smartphones, the new partnership guarantees Flipkart a robust supply chain and better marketing support from Apple. It should also help Apple retain more control over pricing, thereby avoiding a price war in India similar to the one that took place in 2015.
Last year, Amazon India, Paytm, Flipkart, and Snapdeal offered heavily discounted iPhones to buyers, with the iPhone 6s base model, which is officially priced at Rs 63,000 ($945), being sold for as low as Rs 45,000 ($675) shortly after release.
The iPhone 7 will retail at Rs 60,000 ($900), with the base iPhone 7 Plus model costing Rs 72,000 ($1,080).