Walmart looking at tying up with leading Indian e-tailers

After eight years in India, US retail giant Walmart is exploring opportunities to tie-up with e-commerce companies such as Flipkart, Snapdeal, ShopClues, Grofers and Bigbasket. Through them, Walmart wants to tap the ever growing retail market. Till now, no foreign multi-brand retail chain has entered into tie-ups with e-commerce companies in India.

Walmart’s move is significant because it comes at a time when e-commerce giant Amazon is giving stiff competition to Indian e-tailers such as Flipkart, Snapdeal and others. In the US, Walmart and Amazon compete with each other in the online space.

In 2007, Walmart tied up with Sunil Bharti’s Bharti Group to enter the front-end retail space but it didn’t succeed and remained a business to business (B2B) operation in the country both in brick-and-mortar and online. It sells to businesses, organisations and educational institutions but not individual buyers. When Walmart entered into a partnership with Bharti Group, FDI was not permitted in multi-brand. Only in 2012, the UPA government allowed 51 per cent FDI, which came with stringent sourcing and investment norms. In 2013, Walmart had to end its relationship with Bharti and in 2015, Walmart opened its 21st cash-and-carry store in Agra. End December 2014, Walmart’s revenues were down 32 per cent to Rs 2,992.7 crores, caused majorly because of no new store opening. In the same period the company’s loss stood at Rs 232 crores. Now, Walmart is looking at correcting this by laying greater emphasis on its private label business, expecting it to contribute 25 per cent in the next two years.