RETAIL AND MALL MANAGEMENT

ASSIGNMENT

ON

EVALUATE RETAIL MIX STRATEGIES OF

BHARTI WALMART

SUBMITTED BY-

MOHIT YADAV

ROLL NO- C 51

A0101909341
 Bharti Walmart Private Limited
In August 2007, Walmart announced an agreement with Bharti Enterprises to establish a joint

venture, Bharti Walmart Private Limited, for wholesale cash-and-carry and back-end supply

chain management operations in India. Our first BestPrice Modern Wholesale opened in May

2009. Bharti Walmart Private Limited is a joint venture between Bharti Enterprises, one of

India's leading business groups with interests in telecom, agri-business, insurance and retail, and

Walmart, the world’s leading retailer, renowned for its efficiency and expertise in logistics,

supply chain management and sourcing. The joint venture is establishing wholesale cash-and-

carry and back-end supply chain management operations in line with Government of India

guidelines. Under the agreement, Bharti and Walmart hold a 50:50 stake in Bharti Walmart

Private Limited. The first wholesale cash-and-carry facility named “Best Price Modern

Wholesale” opened in Amritsar in May 2009, a second in Zirakpur (Near Chandigarh), a third in

Jalandhar, a fourth in Kota and a fifth in Bhopal. The Joint Venture(JV) in India expects to open

10 to 12 Best Price Modern Wholesale stores and employ approximately 8,000 – 9,000 people by

March 2012.

Four years after announcing its wholesale joint venture with Bharti Enterprises, Walmart, the

world’s largest retail company, is still waiting for the multi-brand retail sector in India to open

for foreign direct investment (FDI). Raj Jain, President, Walmart India, and Managing Director

& CEO, Bharti Walmart, tells that the delay is due to some erroneous assumptions of what

modern retail is meant for.

 Wholesale Cash-and-Carry Format
Best Price Modern Wholesale store is a one-stop shop that meets the day-to-day needs of

restaurant owners, hoteliers, caterers, fruit and vegetable resellers, kiranas, other retail store

owners, offices and institutions. The store offers an assortment of approximately 6,000 items,

including food and non-food items, which are available at competitive wholesale prices, allowing

retailers and business owners to lower their cost of operations.

More than 90 percent of these goods and services are being sourced locally, thereby helping keep

costs to a minimum, adding to the growth of the local economy and creating job opportunities,

with the cash and carry store directly employing more than 200 local people.

Wide Range of Quality Merchandise

A typical wholesale cash-and carry facility will stand between 50,000 and 100,000 square feet

and sell a wide range of fruits and vegetables, groceries and staples, stationery, footwear,

clothing, consumer durables and other general merchandise items.

Efficient Supply Chain to Help Minimize Wastage and Maximize

Value for all Key Stakeholders

The joint venture has also invested in establishing an efficient back-end supply chain

management operation. The joint venture works with the existing supply chain infrastructure to

help make it more efficient, thereby maximizing value for farmers and manufacturers on the one
end and retailers, and in turn, consumers on the other. The supply chain operation supports

farmers and small manufacturers who have limited infrastructure and distribution strength and

help minimize wastage, particularly of fresh foods and vegetables. An efficient supply chain can

play an important role in transforming farmers and small manufacturers into successful

entrepreneurs.

Technical Collaboration between Bharti Retail and Walmart

In addition to the joint venture, Bharti Retail (a wholly-owned subsidiary of Bharti Enterprises)

has entered into a franchise agreement with Walmart whereby Walmart provides certain

technical support to Bharti Retail for its front-end retail venture where Bharti Retail requires

critical retail technology and technical know-how. Within the framework of permitted franchise

arrangements, Bharti Retail has entered into a technical collaboration withWalmart whereby

Walmart provides critical technical support to Bharti Retail. Since April 2008, Bharti Retail has

opened 117 Supermarket format stores in the states of Punjab, Haryana, Rajasthan, Uttar

Pradesh, Uttarakhand, Madhya Pradesh and Delhi and ten (10) Compact Hyper format store in

the states of Punjab, Haryana, Rajasthan, Uttar Pradesh, Madhya Pradesh, Chhattisgarh and

Delhi.
 Sourcing from India
Walmart has been sourcing a variety of products from suppliers in India for more than 20 years.

Walmart’s office in Bangalore serves as Walmart’s Global Procurement (GP) hub for the

sourcing of merchandise from India and Sri Lanka to Walmart stores globally.

GP India also manages Global Procurement from Sri Lanka, including quality control/assurance

audits and ethical sourcing factory compliance audits in Sri Lanka.

Major categories sourced from India include home textiles (including towels, shower curtains,

bath mats, accessories, bedding sheets and kitchen linens), apparel (including woven, knitwear

and leather footwear), leather accessories, fine jewelry and house wares (including fine dining

ware, home décor and tabletops). The main categories sourced from Sri Lanka are apparel,

textiles and gifts.

It wasn’t an ideal start, but this marriage has survived the policy uncertainty and the global

downturn. As the Bharti-Walmart joint venture enters its fourth year, there is a glimmer of hope

on the horizon. A discussion on FDI (Foreign direct investment) in multi brand retail has been

finalised and there are indications the government may finally relent and open a window for

foreign investors. This is perhaps why both partners are keen to accelerate their expansion plans.

The men driving the joint venture Raj Jain, MD and CEO, Bharti Walmart and Rajan Mittal,

Group Lead Director- Wholesale and Retail Business, Bharti decided to give us a glimpse into

operations. Bharti-Walmart has tied up with seven villages and about 130 farmers to pickup fresh

produce daily and directly. Transactions are recorded in the passport given to every farmer and

about 30 tonne of vegetables picked up every day.

Haider Nagar, a village about 40 km from Ludhiana; it is one of the villages that Bharti-Walmart

has co-opted as part of Bharti-Walmart food chain. About 20-25 farmers are enrolled in this

programme as part of this village. Several changes have happen since they became part of the

programme. One is that they get 10% more than the Mandi price. We have been speaking to

these farmers and they say that they have benefited from the technology that Bharti-Walmart has

given them access to better pesticides, agricultural techniques and also the ability to grow

unseasonal vegetables, which finally find their way into the Bharti-Walmart stores. The problem

here is not one of supply, but it’s a lack of demand because Bharti-Walmart has a fewer number

of stores at this point in time so they are able to only co-opt to about 20-25 farmers because there

isn’t enough demand.