INDIA - Most attractive retail destination $ 320 billion now -- $637 billion by 2015 CAGR – 5% Highly Fragmented – “A nation of

shopkeepers” 14% to India’s national GDP Jobs for 7% of workforce

Organized sector – officially licensed retailers Eg. Large privately owned retail company, retail chains etc.

Unorganized sector – hand cart vendors, convenience stores, paan/beedi shops, local kirana stores

•Large number of working youth (median age 24)•Growing number of working women•Nuclear families living in urban areas•Boom in services sector

•Large number of working youth (median age 24)•Growing number of working women•Nuclear families living in urban areas•Boom in services sector

Huge investment in retail infrastructure Traditional markets replaced by new

formats Development of mall culture, supermarket,

hypermarket, and departmental stores. Food entertainment shopping under one

roof

SPENCERSRPGRelianceTATAFuture group

Lack of efficient supply chain Inefficient Third part logistics services Absence of proactive channels

Cold chains Logistics infrastructure warehousing

Lack of skilled employees Inadequate quality control Variation in policy regimes across different states Stringent labour laws Lack of status as an industry therefore difficult to raise capital for expansion Violent protests by small retailers for closure over illegal shops

Established in 1969. Top of Fortune 500 list in 2007 3 subsidiaries :

Wal-Mart International Sam’s Club Wal-Mart Stores Division US

9 Different retail formats Pricing Strategy

Low Pricing Strategy – ‘ Always low Prices’ General merchandise prices – set after price checks of K-Mart

and Target stores Food Prices – set on basis of zones corresponding to food

distribution centres

IT in Supply Chain Management Bar codes for inventory tracking Satellite communication for co-ordination Electronically order placing to suppliers Use of RFID tags

Think Global Act Local Wal-Mart international : international operations 3000 stores in 13 countries Succesful in North and South America but not in

Germany and South Korea Restricted International approach :

discriminatory in entering international markets

Why Bharti ? Market leader in Indian telecom market Thorough understanding of distribution in

Indian markets Fully aware and capable to succeed in complex

environment of Indian market Capability to attract FDI

Joint Venture 2 different formats : franchised retail company

& wholesale cash and carry joint venture

50-50 venture for back end SC management and wholesale cash and carry operations

Also different contract – Walmart sharing technology & expertise to support retail stores built by Bharti

Aim to link farmers directly to retailers Strong back end infrastructure – Cold

chain logistics

Protests by small & medium local businesses Criticised for not being socially responsible

company Widely criticised for practises such as :

predatory pricing, discrimination against women, squeezing suppliers

Dealing with India’s unique cultural factors Supply Chain Management challenges

Underdeveloped physical infrastructure Poor quality of roads, trucking, reluctance to adopt

modern technology Cutting out middleman would create more

opposition

Emergence of organised retail sector Wal-Mart’s joint venture with Bharti aimed at

capitalizing growing middle class Bharti ideal partner for Wal-Mart Many unique challenges in India to overcome If challenges tackled , this partnership could

transform Indian retail