Executive Briefings

Wal-Mart Takes Go-Slow Approach in India

Wal-Mart is going slow in India. Its executives won't admit this, but it is showing no hurry to begin selling in a country where its every move meets opposition.
This was not the scenario envisaged by its Indian partner, Sunil Mittal of Bharti Enterprises, when he decided to link up with Wal-Mart at the end of last year in preference to Britain's Tesco. Mittal switched from Tesco because he hoped to move ahead faster with Wal-Mart, chasing Reliance Retail--part of one of India's biggest groups. Reliance has now opened about 230 smallish neighborhood supermarkets and plans 17 hypermarkets in the coming year, so the Wal-Mart/Bharti combine has no chance of catching up this decade, if at all.
Wal-Mart does not seem unduly worried. Raj Jain, its president for emerging markets who has just been appointed to head the India operations, says that it would grow in India with a "hockey stick curve"--slow at first and then accelerating. On August 6, it announced that it had formally signed its joint venture agreement with Bharti to develop wholesale cash-and-carry stores but--and here came the signal of going slow--these stores would not open until the end of next year and there would only be 10 to 15 in the following six years.
Source: Fortune, http://ridingtheelephant.blogs.fortune.com

Wal-Mart is going slow in India. Its executives won't admit this, but it is showing no hurry to begin selling in a country where its every move meets opposition.
This was not the scenario envisaged by its Indian partner, Sunil Mittal of Bharti Enterprises, when he decided to link up with Wal-Mart at the end of last year in preference to Britain's Tesco. Mittal switched from Tesco because he hoped to move ahead faster with Wal-Mart, chasing Reliance Retail--part of one of India's biggest groups. Reliance has now opened about 230 smallish neighborhood supermarkets and plans 17 hypermarkets in the coming year, so the Wal-Mart/Bharti combine has no chance of catching up this decade, if at all.
Wal-Mart does not seem unduly worried. Raj Jain, its president for emerging markets who has just been appointed to head the India operations, says that it would grow in India with a "hockey stick curve"--slow at first and then accelerating. On August 6, it announced that it had formally signed its joint venture agreement with Bharti to develop wholesale cash-and-carry stores but--and here came the signal of going slow--these stores would not open until the end of next year and there would only be 10 to 15 in the following six years.
Source: Fortune, http://ridingtheelephant.blogs.fortune.com