Ive been hearing about the venture for sometime now, thanks to my dad who keeps me quite informed on businesses and the retail market in India. I smiled and carried on. Today [well, it was out a few days ago, but I read it today] I came across this article, and somehow it’s unsettling.
“With India’s economy growing at 8%-plus annually, retail sales are set to soar from $300 billion today to some $637 billion by 2015, estimates local consultancy KSA Technopak. But the market is now dominated by millions of tiny mom-and-pop shops. An antiquated transportation system and an army of middlemen have hobbled the development of homegrown retail chains with nationwide reach. And foreigners have been shut out by laws barring them from operating anything other than single-brand outlets.“
You can read the whole article here
Those numbers are huge, nothing to sneeze at, but look at it from a micro-level, from where these mom-and-pop shops are at. India thrives on such businesses, sure it’s always comfortable for a consumer to be able to buy rice, a few pens and a vaccuum cleaner all under the same roof, but that seems to jar the whole purpose of livelihood for tons of small business owners all over the country.
MNC’s have made it big in India, every trip I go, am amazed with what’s available and what’s being afforded by the average Joan/John. There have been buy all under one roof kinda stores that have mushroomed over the last few years, and the experience to me as a shopper has been mixed. The convenience is surely encouraging, but I’ve tried not to succumb to it. Shopping in India has a whole charm to it, hopping through stores, finding bargains and finally coming home exhasuted, but I speak like a tourist, as a guest of few weeks, not as a resident. When I compare it with shopping here in teh US, I still compare but tend to focus and completeall necesseties under one roof. The distances and traffic is too cumbersome to navigate to save a few bucks on the price of the product. I value my time more than a few cents, but I have a few worthy friends who think otherwise and hence each to their own.
I have wandered way off there – coming back to what started this whole rambling. Walmart is an icon for cheap affordable prices for your basics. I shop enough there and depending on what you were looking for, the quality isn’t too shabby. I prefer Walmart to Kmart definitely and though Target has an upscale look to it, their prices reflect it, and I occasionally have found some unique and exotic stuff to have fun with there. So..
1. Would I like to see huge Walmarts on my next trip home?
Heck no. 🙂
2. Would an average consumer like walmart?
No idea on what they’d want to market, but am sure it would range between plastics and steel to clothes, and snacks. Perhaps electronics.
3. So would Walmart continue to market ‘made in china’ ?
I just wouldn’t understand the whole business model if that’s what it comes down to. Why have Walmart come in if Indian goods aren’t part of their inventory? If it is, wouldn’t Walmart have an extra 10 rupees for their overhead? Would that help an average consumer in the long run?
4. How huge an impact would this kind of an infrastructure have on a small business owner?By this I mean the guy who hawks wares off Pondy bazaar or the small shops that sell you ribbons and buttons, and the one who makes killer parottas? Will they continue to make money? Profitable money – enough to make it all worthwhile, and if not, where would they go? Is India a huge enough consumer to withstand the rush of the giants, sucking in all that’s sweet and tidy?
What do you think?
Walmart in India – Walmart when opens a “new” always takes a dive down (losses) generally speaking for almost a yr or 2. Yes opening one in China initally did hit losses and they seem to be going high with the profit scores only this year and they continue to sell “MADE IN CHINA” in China…(!). The only difference has been that their sea food section seems to be equal to the Clothing/Home stuff here.
Ok having said that…I am sure they would need to do their due study to figure out what will exactly “thrive” in Indian market.
Now coming to mom and pop stores….inspite of walmart…I think they will still thrive for the Indian society. Honestly on my next trip to India I will be buying black metal jewllery off in Pody bazar or General Bazar vs either going to Jill Mill/Shoppers Stop/Walmart.
Sorry to eat up the comment section on your blog!
As long as it doesnt have Made in China items in it….
Hey there,
Am quite sure that Walmart is gonna personalise their offerings based on the target market. As of now, based on my amateur observations at the Food Worlds and the Big Bazaars in India right now, the consumers mainly seem to shop for food items, cereals, pulses, rice, and mostly toiletries. Now this is where Walmart can either go ahead and make a dent in established HLL and P&G brands with their in-house brands, or they could tie up with these biggies and offer their products at Every Day Low Prices.
With EDLP coming in to India in the form of Subhiksha (mainly in South India), this is a decently established business model which Walmart could improve big-time, given their experience in this form of business.
Cheers……..Jam
there is no shortage for consumers in india. that is for sure.
india has the tradition of bazars and markets where every possible thing will available. fairs, mela, sandhai – india is not new to these concepts.
the food world is doing well. so are a few other super-market chains. i guess walmart would join them.
if i go on a general shopping, i would prefer walmart. if i am more specific, like if i want to buy some jewelery or pepe jeans or adidas shoes, i would go to their showrooms than visiting walmart. i would still make quick visits to the mom-and-pop shops.
Guess it’s all part of the irreversible process called Globalisation.
Some people might not like to ‘come back’ to Walmart. But think of those who never left the shores and yet want to get a taste of life out there.
the mom and pops will stay, atleast for now, the consumer will be the winner because not only has he more choice now but also stands to gain from better quality, better price all around, walmart will have its share of woes too..where will they be located ? atleast in Bangalore..it will have to be on the outskirts and there will be “proximity to the consumer issues” , but most of all I am hoping that it will be a big lesson to Indian businesses in terms of service standards. But yes, eventually Walmart will win, if you can call it that, simply because enough research will go into market analysis and it will be tailored to the average Indian’s needs and there is no denying that!
hey all – I am quite sure we as a nation are strong consumers. wanted to hear your opinions as well. After my long post, on retrospect, I’d really be hugely curious to goc heck a Walmart out back home.. just to see how adapted their market is…
Hi newbies 🙂
Even today the fabmalls and the kaka provision shops co-exist and have their clientele. I think thats what will happen with walmarts too. people who prefer the convenience of everything under a asingle roof will go ther – mostly the yuppies but ther will always be a market for the kaka shop who keeps an account book and you can settle the account at the end of the month!
all kinds of retail units coexist and will continue to appeal to niche or mass segments – point is as a consuemr i will have alternatives
you know what i really hope for? that walmart folks dig desi foods, and suddenly food stuff in walmart-usa has lots of made in india food :-).
– s.b.