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Walmart In India

India is an unusual market for Walmart because they have laws that prevent foreign retailers from doing business in the same fashion as other markets.  In an effort to protect local retailers - namely the mom and pop stores - India has laws that state a foreign company cannot setup a retail store that sells more than one brand under one roof.

Walmart and other international retailers like Carrefour have instead set up wholesale companies in India which then supply the local restaurants and retailers.   To do this, Walmart has partnered with Bharti Enterprises.  The first Bharti Walmart opened in 2009 and there are now six wholesale outlets in India.  Walmart hopes to have 18 outlets by the end of 2011 and will add as many as 12 additional outlets in 2012.

Bharti Walmart India

Bharti Walmart Wholesale Store In India

Interestingly, even if the retail laws are relaxed, Walmart anticipates that they will continue to operate the wholesale business because the opportunity is larger than anticipated.  India is one of the fastest growing retail markets in the world and is definitely the largest least-tapped market.  Sales in India are roughly $1 billion compared to $7-8 billion in China.

In the future, India’s laws should continue to relax as they have a constant food inflation problem.  A large percentage of fresh produce spoils before it is able to be purchased by end consumers.  This is due to unsophisticated supply chains and a lack of investment in retail distribution.  Walmart and companies like it can absolutely help in this area.

Walmart will grow in India year after year for a long time ahead.  Continue to watch this very important market.

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