World’s biggest retailer.
Largest Public corporation by revenue.
First store opened at Arkansas in 1962 by Sam Walton.
One of the World’s largest Private Employer.
Wal-Mart has different types super stores, super
markets, and Wal-Mart discount stores.
Today, Wal-Mart operates more than 10,000 retail
units under 69 banners in 27 countries. It employs
2.2 million associates around the world — 1.4
million in the U.S. alone.
Wal-Mart offer a one-stop shopping experience for
electronics, apparel, toys and home furnishings with
the added convenience of a grocery store with fresh
produce, bakery, deli and meat and dairy products.
To give ordinary people the chance to
buy the same thing as rich people.
1. Lowest prices across the product
2. Product Core competencyLow Prices, In-stock positions,
1. Respect for the individual.
2. High standards of service
3. Constant strive for excellence.
Middle-class, Lower middle class
Consistent Positioning through
“always low prices”
1. Wal-Mart has grown substantially over recent years,
and has experienced global expansion.
2. Deal with Suppliers - Cost Leadership
3. Efficient Supply Chain.
4. Strong IT backup
The company has a core competence involving its
use of IT to support its international logistics system.
For example, it can see how individual products are
performing country-wide, store-by-store at a glance.
Unable to adapt to different cultures/countries. Eg:Germany.
2. Heavily dependent on ‘bulk sales’.
3. No success beyond Americas.
4. Since Wal-Mart sell products across many sectors
(such as clothing, food, or stationary), it may not
have the flexibility as compared to its competitors.
Enter New Economies - India/ China/ Brazil.
To take over, merge with, or form strategic alliances
with other global retailers, focusing on specific
2. Rising disposable incomes.
3. New Channels- Marketing / Internet based models.
4. J.V with some leading players.
Restrictions on FDI in India.
International law against dumping.
Law against “Monopoly” –anti thrust policies.
Wal-Mart Expansion: Past Track Record
Acquired a Weak
M & A Synergies
Acquired a Big
focused on need
Union and Law
JV of Bharti-Walmart
On November 2006, Wal-Mart Stores Inc. and Bharti
Enterprises Ltd. signed a (MoU) to explore business
opportunities in the Indian retail industry.
Bharti's JV with Wal-Mart is for cash-and-carry stores
(wholesale) --- which sell products in bulk to other
Bharti manages the front end, involving opening of
retail outlets, while Wal-Mart takes care of the back
end operations, such as cold chains and logistics.
Bharti-Walmart operates stored in India under the
brand name "Best Price Modern Wholesale".
90 per cent of sourcing would be from the local market
and going forward this joint venture would help in
in-creasing Wal-Mart’s global sourcing from India.
Products- are food, FMCG, vegetables, general
merchandise and electronics.
Members/cust.- are small kirana shop owners, hotels,
restaurants, schools, colleges, the police force and even
the Indian Army.
50:50 joint venture: In India, Wal-Mart has a 50:50
joint venture with Bharti Enterprises in the wholesale
Direct Farm Program: Partnership with 110 small and
marginal farmers encourages cultivation of safe, highquality, seasonal vegetables.
Training centers: Bharti-WalMart (Best Price Modern
Wholesale) intends to set up its own training centers
to train less-privileged youth to work in retail stores.
Key Challenges in India
FDI Restrictions –
FDI Restrictions of 51% on Multi-brand Retail.
Social & Political Resistance –
A strong opposition from certain political parties is
certainly expected in some parts of society – local
retailers, dealers would protest.
Countering deep penetration of ‘Mom & Pop’ Stores Especially in Tier-II & III cities, the network of ‘ Kirana
Stores’ is extensive. Also sales on credit facility is
available which Wal-Mart cannot do.
Poor Infrastructure will cause friction –
Indian standards of roads, ports & freight facilities are
way below global benchmark. It will lead to
inefficiency in the value chain.
Regional Diversity amd heterogenity–
Challenge to have tactics according to regional/
What brings Wal-Mart to India?
Retailing in India is emerging as one of the largest
industries, with a total market size of $450 billion in 2012
and growing at a grwth rate of 5%.
A tremendous market Emergence of middle class.
Consumer spending growing rapidly - 60% of Indian
population is in age group of 20-30 & is more inclined
towards modern shopping.
With the opening up of Indian Retail sector for FDI up to
51% Findings in multi-brand retail, India is set to become
hub of Multinational Retailers from across the Globe.
India's position as the world's second-largest producer
of fruits and vegetables- so, refrigerated distribution of
fruits and vegetables can add value to customers by
means of low price and wide range of merchandise.
Competitors of Wal-Mart in India
Big Bazaar (Future
Upper Middle Class +
Lower Middle Class
Mostly Upper Class
Star Bazaar(Tata Group)
Upper Middle Class +
Lower Middle Class
Middle Class +Upper
Strategic Gaps of Wal-Mart.
Wal-Mart is limited mainly to Metros, Tier-I cities.
Huge potential lies in sub-urban, rural markets, Tier-II
& Tier-III cities.
Geographical Gaps – Markets like North East of India
are yet to be explored.
Truly Global Shopping Experience missing in Indian
( Wal-Mart has to incorporate Indian Values &
preferences while designing the business model. Focus
on strategic gaps critical for its eventual success.)
Negative effects due to Wal-Mart’s
entry in the Indian retail industry
Loss of Business
Many of the small scale department stores in India are the
major contributors to the Indian economy, the entry of
Wall- Mart into Indian market may lead to loose the
business to many of the middle and small scale people.
Low price products
Wall- Mart in order to capture the Indian market is trying
to introduce low price strategy on their products which in
turn affect the other local businesses. Local traders later
also should implement this pricing strategy which may
affect their profit margin.
Creates excess competition
Due to the entry of Wall –Mart into the Indian market
the competition may increase between local retailing
businesses like Pantaloon, Reliance etc. we can see a
tough competition between these business units in
Local traders from the major of the cities were
opposed the entry of retail giant Wal-Mart especially
in Delhi because it will affect the local traders or
business man and also for small retail shops.
Positive effects due to Wal-Mart’s
entry in the Indian retail industry
Win-Win situation for farmers-
The profit realization for farmers selling
directly to the organized retailers is expected
to be much higher than that received from
selling in the mandis.
Improvement in supply
chain/infrastructureIncr. in invst. in both forward and backward
infrastructure such as cold chain and storage
infrastructure, warehousing and distri.n
channels thereby leading to improvement in
the supply chain infrastructure in the long
Inflow of massive capital
Wal-Mart would bring in needed invst that
would spur the further grwth of retail sector.
High invst would be important for the
sustenance during economic slump, otherwise
co. would be out of market. Such as the case with
Vishal, Subhiksha and Koutons, which couldn't
arrange for funds.
More jobs across the supply chain.
It would lead to the creation of millions of jobs
as massive infrastructure capabilities would be
needed to cater to the changing lifestyle needs of
the urban India who is keen on allocating the
Wal-Mart's entry in India would bring with itself the
technical know-how, global best practices, quality
standards and cost competitiveness
Reduction in losses of agriculture produce.
Removal of unnecessary intermediaries in retail value
World class stores with good customer service
Everyday Low Prices
Quality assortment of merchandise
Increased govt. revenue.