Wal-Mart Drops Ambitious Expansion Plan for India

[mota bhai 2,675]

MUMBAI — Wal-Mart Stores gave up on India’s huge market on Wednesday, announcing that it had indefinitely delayed its once-ambitious plans to open hundreds of superstores across the country.

...

Wal-Mart, the Bentonville, Ark., company that is the world’s largest retailer, also announced that it was ending its joint effort with Bharti Enterprises of India to operate 20 wholesale “cash and carry” stores that sell to other businesses like retailers, hotels and restaurants.

Wal-Mart plans to buy Bharti’s 50 percent stake in the venture, and the two companies will operate independent businesses in India. That Wal-Mart kept the wholesale business, long seen as a way to learn about India’s fragmented retailing sector, suggests it has not entirely ended its hopes of eventually selling at a retail level.

...

Wal-Mart’s chief executive for Asia, Scott Price, said this week that the Indian government’s regulations requiring foreign retailers to buy 30 percent of products from local small and midsize businesses were the “critical stumbling block” to opening its trademark consumer stores.

“I don’t understand how this 30 percent small and medium enterprise can be executed,” Mr. Price said in an interview on Monday at the Asia-Pacific Economic Cooperation forum in Bali, Indonesia, The Associated Press reported.

He said that Indian retailers were not required to follow the same rule, which made it too difficult for outsiders to make money, because no enterprise small enough to meet the government’s requirements had the capability to produce on the scale that a giant retailer requires.

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Only 4 percent of India’s $500 billion retail market is controlled by large, Western-style chain stores. In China, the share is about 20 percent and in Brazil 36 percent. India’s tiny operators have few of the inventory controls of their larger brethren, and much of the country’s food spoils before reaching consumers — an unfortunate reality in a nation in which nearly half of all children are malnourished.

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Wal-Mart’s problems in India extend well beyond the government’s procurement rules. The Indian authorities are investigating whether Wal-Mart violated foreign investment rules by giving Bharti Retail an interest-free loan of $100 million that could later be converted into a controlling stake in the company. Both companies deny wrongdoing.

http://www.nytimes.com/2013/10/10/business/international/wal-mart-puts-india-plan-on-hold.html?_r=0

[Harpa Timsah 13,258]

No Walmart! Bad!

[RGinWA 816]

World domination has been delayed...

[Jacque67 7,328]

Good for India. The people there must have seen the South Park episode about Wal Mart

Edited October 11, 2013 by Jacque67

[mota bhai 2,675]

Actually, a company like Walmart would do a lot of good for the Indian retail sector.

[Jacque67 7,328]

Actually, a company like Walmart would do a lot of good for the Indian retail sector.

You think Wal-Mart has done wonders for the American retail sector??

[mota bhai 2,675]

You think Wal-Mart has done wonders for the American retail sector??

No. Do you read or have you given up?

[Harpa Timsah 13,258]

Actually, a company like Walmart would do a lot of good for the Indian retail sector.

Why would sucking the life out of Indian companies be any different than here?

[mota bhai 2,675]

Why would sucking the life out of Indian companies be any different than here?

India has a supply chain problem. Walmart is a supply chain master. India needs that kind of expertise.

[Jacque67 7,328]

No. Do you read or have you given up?

Ooooooooo.

[Crashed~N2~Me 970]

Additionally...Wally had intentions of hiring 150,000 plus on top of current employment. Lots would jump at their low wage job offer. Low wage is better than no wage.

[Jacque67 7,328]

Additionally...Wally had intentions of hiring 150,000 plus on top of current employment. Lots would jump at their low wage job offer. Low wage is better than no wage.

That is rather a short term view.

Surely India can establish it's own brand?

[mota bhai 2,675]

That is rather a short term view.

Surely India can establish it's own brand?

Yes, and it will be just like Walmart.

Reinventing the wheel is generally not a good idea. Walmart has already perfected SCM. Walmart is a case study in SCM excellence in B-schools worldwide.

[Mr. Big Dog 10,747]

Yeah, they're also a good case study on how what works in one country will blow up in your face in another.

Why did Wal-Mart fail in Germany?

[Póg mo 1,749]

Additionally...Wally had intentions of hiring 150,000 plus on top of current employment. Lots would jump at their low wage job offer. Low wage is better than no wage.

Hasn't this been India's problem? Lots of low wage jobs, with most of the wealth controlled by a few individuals? I am not sure how Walmart would help matters any!