Bharti Walmart entered the Indian retail market in 2007 through a joint venture between Bharti Enterprises and Walmart. The Indian retail market is highly fragmented with 98% of the market being unorganized. Bharti Walmart faces challenges in managing cultural diversity, regulations, and opposition groups. However, its strengths include extensive global retail expertise, supply chain management, and the use of technology. Currently, Bharti Walmart operates 117 retail stores and 7 cash-and-carry stores in India, located based on factors like regulations, spending power, and infrastructure to support its supply chain.

1. BHARTI WALMART INDIA STRATEGY
Strategic Management
Prepared By
Vikas Gupta
General Management Program
2011-2012

2. Retail Market in India
Total Retail Market Size
 Indian Retail market highly fragmented 637 Billion
 Estimated at $ 320 Billion (2006), $ 427 Billion
(2010) and $ 637 Billion (2015)
427 Billion
 Mainly dominated by unorganized retail in the
320 Billion
form of kirana stores, mom-and-pop stores, small
stores etc.
 Only 2% currently Organized v/s 98 %
unorganized 2006 2010 2015
Estimated Market size for Organized retail is $7.17
Billion (2006) and $20 Billion (2010)
Market Size Organized Retail
Organized
2% 637 Billion
427 Billion
320 Billion
Unorganized
98% 7.17 Billion 20 Billion
2006 2010 2015

3. Indian Consumer Behavior
• US consumer – “Buy and Pay” whereas Indian consumer
“Save and Buy”
• Change from “Save and Buy” mentality to “Buy and Pay”
mentality mainly observed since year 2000
• Global brand flooding India and consumer demands better
quality, variety and lifestyle products
• Consumer disposable income and purchasing power
increasing
• Demand for Organized retail emerged

4. Indian Demographics
Since the economic liberalization, India has seen –
• Increase in working youth
• Increase in working women
• Increase in nuclear families
• Increase in opportunities in service sector
• Enhancement of living conditions
• All these leads to increase in consumer spending and
purchasing power

5. Indian Govt Retail Policy and Regulations
• As of 2006, 51% FDI in multibrand retailers
• 100% FDI in wholesale cash-and-carry and
backend logistics
• Variation on policy at State Levels
• Stringent labor laws

6. Social and Political environment
• Dealing with India’s unique cultural sensitivity
factors
• Regional differences
• 6000 caste, sub caste – vast diversity
• Strong opposition from mom-and-pop stores, trade
unions, women’s group and local communities
• According to left wing and NGO’s, Walmart will
destroy livelihood of 40 Million people in India

7. Porter Five Force Analysis
POLITICAL
T
E
C • High Entry Barriers
Threat of new entrants
H • High Capital MEDIUM
• Regulations S
N O
O Intra Industry
Suppliers Bargaining Buyers Bargaining C
N Competition
Power LOW Power HIGH I
O HIGH
A
L • With stiff
• Walmart has L
competition from
O strong bargaining
Reliance, RPG, Tata,
power over
G suppliers Threat of Substitutes Aditya Birla
group, buyers get
I MEDIUM higher bargaining
C power
A
L ENVIRONMENTAL

8. Walmart
• Largest department store
• Biggest public corp in the world
• Corp Philosophy – Strengthening its relationship with
employees, suppliers and customers (core competency)
• Own transportation network
• Low pricing strategy – cost leadership (core competency)
• Robust and efficient Supply Chain network (core competency)
• Cold chain logistics i.e. refrigerated trucks and distribution
centers to reduce wastage
• Leveraged IT to enhance their Supply chain.
• Use of Technology for improved planning, accurate
merchandizing, enhanced customer experience, improved
workforce management, strengthened store operations
(core competency)

9. Why Walmart did well in other
International locations ?
• Ability to apply its unique culture and successful retailing
concept despite daunting business and cultural challenges
• Involve in local communities and adapt to local cultures –
Glocalization
• Sourcing 90% products locally
• Hiring locally and supporting local communities.

10. Bharti-Walmart
Why Bharti ?
• Good history of partnering with overseas companies
• Bharti attracted $1.2 billion in foreign equity – highest in
India
• No 1 in Telecom business in India
• Bharti has deep knowledge of India’s fast growing consumer
market
Walmart
• Extensive global retail expertise
• Ability to apply its unique culture and successful retailing
concept.

11. Bharti-Walmart
• Bharti to own retail shops under
Walmart franchise
• Bharti-Walmart to jointly operate
(50:50) Wholesale Cash and
Carry and backend logistics
• Wholesale Cash and Carry means
supplier to Retailers and Small
business such as
Hotels, restaurants, vendors, hos
pitals etc
• Walmart to invest $100-450
million

12. Bharti Walmart Challenging
landscape
 Managing cultural diversity
 Managing Union and State level regulations
 Handling oppositions from Trade Unions, local kirana
stores, left wing, NGO etc
 Under-developed infrastructure: quality of Roads, trucking
 Adoption of modern technology in india
 Want to cut middleman by linking suppliers directly with
consumers. Facing strong opposition from trading
community

13. Bharti Walmart stores
• India is already a huge supplier to Walmart. India supplies
goods worth $1.6 Billion to Walmart
• First store opened in Amritsar, Punjab. This part of the
country has sent many migrants to North America, we see
a glimpse of NRI driven globalization
• As of now 7 Bharti Walmart Cash and Carry stores in India
• As of now, 117 Bharti Retail Supermarket stores in the
states of Punjab, Haryana, Rajasthan, UP and Delhi
• 10 Compact Hyper Market stores
• Walmart’s office in Bangalore to serve as Global
Procurement Hub

14. Bharti Walmart’s Store Location
decision criteria
• State Laws and Regulations
• Ruling party in the state
•Availability of goods locally
• Political and Social Acceptance Factors
• Consumer Behavior and Spending power
•Demographics and Psychographics profile of consumer
• Influence of Globalization culture. E.g. Places such as
Punjab, Bangalore, Hyderabad, Mumbai has more
globalization effect than places such as Kolkata
• Quality of Infrastructure (Roadways, Trucking) to support
their supply chain operations

15. THANK YOU