Two years after scrapping plans to open retail outlets across the world’s second-biggest consumer market, Wal-Mart plans on becoming a major wholesaler in India. Last year it appointed Krish Iyer, as its new chief executive in India as it shifted its focus to the country’s $300-billion wholesale industry.
Since there are no restrictions on foreign ownership of wholesale “stores”, Wal-Mart has fashioned itself a partner to India’s traditional mom-and-pop grocers by opening its first new Best Price Modern Wholesale store in India this month. It plans to expand to 70 such stores in five years.
Urban India’s culture and geography favors the corner grocer. Most Indians prefer fresh fruits and vegetables, and in large cities where kitchens can be small, people tend to shop every day or two rather than store large quantities at home.
“Wal-Mart is making the most out of what’s available and ensuring it does build up a workable, scalable business model in India,” said Devangshu Dutta, chief executive of Third Eyesight, “As and when the regulations evolve, they could step into a direct retail operation.”
