Even as Wal-Mart and Bharti try to iron out a deal on wholesale cash-and-carry venture, Wal-Mart’s Raj Jain has sought to reassure kirana store owners.
Even as Wal-Mart and Bharti try to iron out a comprehensive agreement on their wholesale cash-and-carry venture for India, Wal-Mart’s president for emerging markets, Raj Jain, has sought to reassure small retailers and kirana store owners that the US retailer’s arrival means increased profitability for them as well. Excerpts from Sindhu Bhattacharya’s e-mail interviews with Jain and Beth Keck, the senior director - international corporate affairs at Wal-Mart:
You say Wal-Mart plans to establish links with small retailers by partnering them. How is this going to be done?
Wal-Mart will enter into a joint venture with Bharti for our wholesale cash-and-carry business in India that will sell quality goods to retailers, including small store owners — or kirana stores. Through our cash-and-carry venture, our aim is to establish an efficient wholesale supply chain linking farmers and small manufacturers - who lack adequate brand power or distribution strength - directly to retailers, thereby minimising wastage of fresh foods and vegetables as well as helping control inflation. Our goal is to establish a relationship with the small business community by partnering with them and helping them to lower costs and increase profits. A good example is our Sam’s Club format, which is designed to serve small businesses.
Are you, for example, going to supply to push cart vendors and wholesalers at wholesale rates even as Bharti sells the same produce at its front-end outlets?
Our wholesale cash-and-carry operations are for this specific purpose - to supply quality goods to retailers, organised and unorganised, including kirana stores. It is our hope that small retailers will become our customers, take advantage of the efficiencies we are able to provide and derive significant benefits for their businesses.
Other retailers are coming up with ideas like hiring the local kirana shop premises to hawk their wares. This helps the kirana shop owner make good rental money and also enable him to begin another enterprise while the big retailer gets tailor-made real estate and customer goodwill.
Any such plans by Wal-Mart for India?
Our wholesale cash-and-carry joint venture agreement with Bharti is in the process of being finalised and an announcement will be made at the appropriate time.
You’ve spoken about being the employer of a large woman workforce. Any plan for a women-heavy workforce in India? Would you be involving housewives and part-timers also?
Wal-Mart is an equal opportunity employer and we are dedicated to building and retaining a diverse workforce. We will follow the same practice in India.
Wal-Mart is known the world over to offer the lowest possible prices across a range of food and grocery items, besides other products. Is the same pricing model to be followed in India?
Worldwide, our business philosophy for our retail operations is that when we increase the efficiency of our business we pass those savings on to our customers. Similarly, in India….we would expect to follow the same business model.
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