Monday 2 March 2020

Walmart to turn some stores into Flipkart warehouses

Walmart to turn some stores into Flipkart warehousesNEW DELHI: US-based retailer Walmart has set in motion plans to convert some of its two dozen wholesale stores into fulfilment centres for homegrown ecommerce firm Flipkart, which it owns, as part of a restructuring process of its cash-and-carry business, multiple people familiar with the development said.

“Out of the 28 stores, six will be converted into fulfilment centres,” one of the people said, asking not to be named. Another person said Walmart’s plan is to turn many more of its ‘Best Price’ brand cashand-carry stores into warehousing in the coming months. Top global consulting firms are pitching on how best to convert the existing outlets into warehouses, a third person said. A spokesperson for Walmart declined to comment.

The move comes barely a month after Walmart said it had sacked more than 50 employees in India as part of a restructuring of its loss-making Walmart India business which runs the 28 Best Price stores nationwide.

Walmart has had a rollercoaster ride with its physical retailing business in India. In 2013, it called off a 50:50 joint venture with Bharti Enterprises to go solo with its wholesale business, a retailing area where India permits 100% overseas investment, although such ventures can only sell to other businesses and institutions, and not to consumers directly.

After the split with Bharti, the US giant froze expansion plans for years and devoted time to an internal anti-corruption probe and to comply with a US anti-bribery law. Walmart entered India in 2009 with its first wholesale store in Amritsar. Its Best Price stores had accumulated losses of Rs 2,180.80 crore till March 2019. In the previous fiscal year, Walmart India posted sales of Rs 4,095 crore on a net loss of Rs 171.6 crore.

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