Wal-Mart Slated to Change the Game for India’s Supply Chain

According to Bloomberg News, “Wal-Mart is counting on its online operations to help fuel sales as it grapples with a slowdown both at home and abroad. The Indian website is only for existing users of its members-only cash-and-carry stores and may help draw orders from small businesses more than 20 kilometers (12 miles) from outlets and that aren’t serviced by sales representatives, said the company’s chief executive for India Krish Iyer.”

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Wal-Mart’s new plan will not appeal directly to consumers. Specifically, the company will target India’s local mom-and-pop shop owners who run neighborhood stores known as kirana. These shops often have a high need for wholesale goods.

For now, the program will debut in the cities of Hyderabad and Lucknow only. In the near future, Wal-Mart hopes to account for at least 10 percent of all kirana buyer orders.

The retail juggernaut claims the new model, in some cases, will help new Indian business owners break into kirana trade by providing opportunities for goods that didn’t exist in the country prior.

Forbes notes, “The business-to-business website is exclusively available to members of its expanding, 20-store Best Price Modern Wholesale cash-and-carry chain, a model similar to its Sam’s Club warehouse format in the states.”

This expansion may have bigger implications than Wal-Mart’s initial plans for kirana stores. Analysts predict that there will be other buyer opportunities in the hospitality and health care industries.

Reuters reports, “Wal-Mart has been operating under the wholesale format in India since 2007. The company’s desire to enter India with supermarkets has been met with fierce opposition from small shopkeepers and political parties.”

Wal-Mart’s current 20 wholesale stores operate throughout India. The retailer plans to integrate these outlets with the online e-commerce platform.

This latest news comes after the company recently nixed plans to open 50 more wholesale operations in the country. [/show_to]