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    Walmartindia

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    Ashok Swamy
    Wal-Mart entered the Indian market in 2007 through a joint venture with Bharti Enterprises. It opened its first store in Amritsar, Punjab in 2009 under the Best Price Modern Wholesale brand. The store employed 200 locals and aimed to create 500 indirect jobs. While Wal-Mart hoped to capture a share of India's growing retail market, it faced challenges from established local retailers known as "kirana stores" that offered lower prices and a more personalized experience for customers. Wal-Mart tailored its strategy to the Indian market by focusing initially on wholesale cash-and-carry stores and sourcing locally from small farmers.

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    Walmartindia

    Uploaded by

    Ashok Swamy
    45 views3 pages
    Wal-Mart entered the Indian market in 2007 through a joint venture with Bharti Enterprises. It opened its first store in Amritsar, Punjab in 2009 under the Best Price Modern Wholesale brand. The store employed 200 locals and aimed to create 500 indirect jobs. While Wal-Mart hoped to capture a share of India's growing retail market, it faced challenges from established local retailers known as "kirana stores" that offered lower prices and a more personalized experience for customers. Wal-Mart tailored its strategy to the Indian market by focusing initially on wholesale cash-and-carry stores and sourcing locally from small farmers.

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    Wal-Mart entered the Indian market in 2007 through a joint venture with Bharti Enterprises. It opened its first store in Amritsar, Punjab in 2009 under the Best Price Modern Wholesale brand. The store employed 200 locals and aimed to create 500 indirect jobs. While Wal-Mart hoped to capture a share of India's growing retail market, it faced challenges from established local retailers known as "kirana stores" that offered lower prices and a more personalized experience for customers. Wal-Mart tailored its strategy to the Indian market by focusing initially on wholesale cash-and-carry stores and sourcing locally from small farmers.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    45 views3 pages

    Walmartindia

    Uploaded by

    Ashok Swamy
    Wal-Mart entered the Indian market in 2007 through a joint venture with Bharti Enterprises. It opened its first store in Amritsar, Punjab in 2009 under the Best Price Modern Wholesale brand. The store employed 200 locals and aimed to create 500 indirect jobs. While Wal-Mart hoped to capture a share of India's growing retail market, it faced challenges from established local retailers known as "kirana stores" that offered lower prices and a more personalized experience for customers. Wal-Mart tailored its strategy to the Indian market by focusing initially on wholesale cash-and-carry stores and sourcing locally from small farmers.

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    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Wal-Mart in India

    ‘In most countries, supermarket chains create and manage well-oiled supply chains to offer consumers lower prices and dampen

    inflationary trends. Inflation in India is touching decade-highs. But then it’s a fallacy that in India it is always about low price’. Companies

    like Tata, Birla and Reliance have all attempted to enter food-and-grocery retailing in India with mixed success. Will Wal-Mart’s supply

    chain work in India?

    Contents

    1. Introduction – Wal-Mart’s first store in India

    2. Joint venture with Bharti Enterprises

    3. About Wal-Mart

    4. Wal-Mart – Background Note

    5. Wal-Mart – Timeline

    6. Wal-Mart – Quick Facts

    7. The world’s largest retailer isn’t new to India

    8. India’s first special skills training centre

    9. Exhibit – Wal-Mart’s business model in India

    10. Mera Kirana programme

    11. Exhibit – Foreign hypermarket chains in India

    12. Wal-Mart Internationally

    13. Exhibit – Wal-Mart and Expansion into International Markets

    14. Wal-Mart’s imperfect success record in a foreign country

    15. Cost-Leadership Strategy- Wal-Mart’s core philosophy – EDLP (every day low prices)

    16. Will Wal-Mart succeed in expanding outside the U.S.?

    17. Best Practices and lessons from the International Markets

    18. Wal-Mart India – Plans and Challenges

    19. Wal-Mart’s Strategy and Supply Chain tuning for India

    20. Physical and Regulatory Challenges

    21. The Indian Consumer

    22. Bringing private label suppliers to India

    23. Will the kirana store go out of business?

    24. Advantages of a small Indian shopkeeper – The Kirana store

    25. Exhibit: Wal-Mart – Store Formats

    26. Exhibit: Wal-Mart – International operating formats

    27. Questions for Discussion


    Sample Page/Content

    "India is a price sensitive market and therefore we will be devising our strategy for her very carefully…Retailing is like a game of three

    dimensional chess where we operate as a local, regional and global player, so depending on the needs of the market we shall change

    our format and adapt." – John B Menzer, President and CEO, Wal-Mart International.

    "India is not a homogeneous market, so ours is not a cookie-cutter approach from the U.S. …Wal-Mart is in no hurry to unfurl the Wal-

    Mart flag nationally. The easiest thing is to roll out stores, but the most difficult is to sustain and feed them." -Raj Jain, President of

    Wal-Mart India in May 2009.

    "Wal-Mart operates with multiple private brands around the world. In each market that we operate, we look to be local. We treat each

    market as unique and India, in this respect, is no different." -Arti Singh, vice-president of Corporate Affairs at Bharti Wal-Mart.

    1. Introduction – Wal-Mart’s first store in India

    In December 2006, Wal-Mart Inc. believed that by the year 2015, 35% of India’s retail sales could be from chain stores . This was a

    radical increase from the prevailing 2%. In May 2009, Wal-Mart was ready to open its first store in India. The reason for Wal-Mart’s entry

    in India was clear – The Indian middle class . The world’s biggest retailer had been silently working on its strategy for India for around

    two years. Mom-and-pop stores and traditional distribution networks dominated the $375 billion Indian retail market. Wal-Mart’s first

    outlet was set to launch in the city of Amritsar, Punjab in North India. The first store air-conditioned and built over 50,000 sq. ft. was on

    the outskirts of the city, Amritsar. The store employed 200 locals and was likely create 500 indirect jobs. In the first few weeks itself, the

    company had managed to sign on close to 35,000 members. However, the debut outlet was not to carry the familiar Wal-Mart brand.

    Did this mean Indian consumers could not benefit from Wal-Mart’s everyday low prices?

    Download PDF file to read more.

    Case Updates/Snippets

     50:50 joint venture: In India, Wal-Mart has a 50:50 joint venture with Bharti Enterprises in the wholesale cash-and-carry

    segment.

     Direct Farm Program: Multinational retail giant, Wal-Mart’s Direct Farm Program in India is a partnership with 110 small and

    marginal farmers near Ludhiana in Punjab where it encourages cultivation of safe, high-quality, seasonal vegetables.

    Farmers are advised at every stage of cultivation by field agronomists. Farmers learn about nursery management,

    transplanting, nutrient management, as well as harvest and post-harvest practices.

     Wal-Mart India in 2010: In 2010, Bharti-Wal-Mart plans to launch seven Best Price Modern Wholesale Cash-And-Carry

    stores across India. These stores will be 100,000 sq ft in size and each store will involve an investment of $6-7 million.

     Sourcing from India: Wal-Mart has a large sourcing business in India. The retail major sources goods worth $125 million a

    year from Punjab. In 2010, Wal-Mart is planning to increase sourcing from India to strengthen its global business.

     Preference for Kirana/local retailers: According to a survey by ASSOCHAM in early 2010 in which it interviewed 5000

    shoppers in various cities in India, kirana stores (mom and pop stores) and local retailers were the preferred destination for

    shoppers as compared to shopping malls. The survey found that goods were less expensive (as much as 25%) in local
    kirana stores as compared to big shopping malls. Smaller stores also offered more variety and affordable options with

    sustainable quality at a negotiable price (reduced margins).

     Training centers: Inheriting a model from its U.S. parent, Bharti-WalMart (Best Price Modern Wholesale) intends to set up

    its own training centers to train less-privileged youth to work in retail stores.

     FDI in retail in India: In India, the Government presently does not allow foreign investment in multi-brand retail. It allows

    51% FDI in single-brand retail and 100% in wholesale venture. In 2007, Walmart Stores and Bharti Enterprises entered into a

    joint venture and began cash & carry stores under the brand Best Price Modern Wholesale.

     Carrefour in India – Carrefour Wholesale Cash & Carry: In December 2010, Carrefour, the French international chain,

    launched its first cash & carry store in India (in the capital in New Delhi). The store with an area of 5200 square meters offers

    about 10,000 SKUs in food and non-food to local businesses, restaurants and local mom and pop stores.

     METRO Cash & Carry in India: In 2003, METRO Cash & Carry entered the Indian market in the self-service wholesale

    category. By early 2011, it had six wholesale distribution centers in four major cities (Bangalore, Hyderabad, Mumbai and

    Kolkata). The company caters to business customers (hotels, offices and small retailers) and sources a large part of its

    products locally from local suppliers, co-operatives and self-help groups.

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