Walmart India to open 15 cash-and-carry stores, foster more help for farmers

by Talk Business & Politics staff ([email protected]) 73 views 

Walmart India announced Tuesday (Jan. 12) plans to open 15 more cash-and-carry stores in the southeastern state of Andha Pradesh. The 15 cash and and carry stores, akin to Sam’s Club, are part of the 50 the retailer plans to open by 2018.

The retailer also is creating a center for sourcing agriculture products from small and marginal farmers, according to media reports out of India.

Wal-Mart Stores has tread lightly in India in the past few years after allegations the retailer violated Foreign Trade Corruption protocol. The allegation are still under investigation. After pulling out of a partnership with Indian retailer Bharti in October 2013, Wal-Mart vowed to go its own way and focus the wholesale side of the business.

Krish Iyer, president and CEO of Walmart India, said the retail giant hopes to work with small farmers, invest in training to help maximize crop yields and ensure they have the supply chain infrastructure to grow distribution. The initial timeline given by Iyer was 12-18 months before the efforts are visible. Iyer also said challenges to ongoing expansion in India include the cost of real estate for purchase as well as rentals, which can hinder profitability.

David Cheesewright, CEO of Walmart International, told Talk Business & Politics in June 2015 that Wal-Mart was not going to alter its wholesale-only strategy despite the 1.2 billion consumers and $534 billion value of India’s retail market .Cheesewright was asked to explain the retailer’s plan for India as it is seldom mentioned in earnings calls and remains a small and somewhat stymied market in Walmart’s international portfolio.

“India is important long term because they do have so much potential. There is still a lot to sort out there around Foreign Direct Investment and so on,” Cheesewright said. “We are happy to be in cash and carry. We have 20 wholesale stores for what is still a very fragmented market.”

Walmart India Private Limited is a wholly owned subsidiary of Wal-Mart Stores Inc. Walmart India owns and operates 20 Best Price Modern Wholesale stores in 8 states across India. The first store opened in Amritsar in 2009, according to the retailer’s website.

Cheesewright said in 20 years he believes Walmart will be glad it stayed in India.