Wal-Mart Stores Inc, which runs cash-and-carry stores in the country through its arm, Walmart India, plans to deepen its presence by opening more stores in the existing states where it currently operates.

Walmart India plans 50 more outlets by 2020
Walmart India

Wal-Mart Stores Inc, which runs cash-and-carry stores in the country through its arm, Walmart India, plans to deepen its presence by opening more stores in the existing states where it currently operates. It is targeting to open 50 more stores by 2020, while at the same time be profitable in each of its stores by managing inventory better.

“The strategy is to owning a city, owning a state or province,” Krish Iyer, chief executive of Walmart India, told FE. This would mean that the firm would open more stores within the states where it is currently present rather than expanding into newer states. All of its new stores will also have a e-commerce channel, he added.

Currently, Walmart India owns and operates 21 stores under the brand name Best Price Modern Wholesale in nine states, including Punjab, Rajasthan, MP, Chhattisgarh, UP, J&K, Andhra Pradesh and Telangana, and Maharashtra.

Walmart entered into India in 2007 through a joint venture with Bharti Enterprises, the parent company of Bharti Airtel. The joint venture Bharti-Walmart opened its first store in 2009 in Amritsar. However, in 2013, the two partners split with Walmart retaining the wholesale business while Bharti held the retail operations, which has since been sold to Future Group.

Iyer took over the operations in February 2014 and since then, Walmart has not opened a single new store, except for one purchase of a wholesale cash-and-carry business of Carrefour, which exited India. Until then, Walmart had 20 stores. “We want to adopt a cluster approach when GST comes into place. That would mean we need a single distribution centre instead of multiple consolidation centres in three-four states,” Iyer said.

The strategy is to build more stores within a state and have one distribution point for multiple stores within and the neighbouring states, he explained, adding that the move would help the company manage its inventories better and reduce wastage and improve profits. “B2B is a low-margin business, it makes important to create inventory,” Iyer said. “We are well on target,” Iyer said on the overall plans to add 50 more stores. Currently, Walmart India has got approvals for eight sites and it is currently in negotiations for another 10 more, he added.

Source: Financial Express

Walmart India plans 50 more outlets by 2020