The company announced on Tuesday that it is entering the wholesale e-commerce space and will extend the business-to-business (B2B) e-commerce platform to its Best Price Modern Wholesale store members.
The platform will provide them with a convenient online shopping opportunity. As an exclusive virtual store for its members, the e-commerce platform will provide a similar assortment of products, as well as special items.
Online retail, at present, accounts for less than 1% of the total market in India, but this space is slated to grow at 50-55% over the next three years to reach R50,400 crore by 2016, according to a report by Crisil. This is close to a four-fold rise from the estimated market size of R13,900 crore in 2013.
Moreover, at a time when the country is inviting investments in the front-end multi-brand retail sector, Wal-Mart plans to open 50 cash-and-carry or wholesale stores in the next 4-5 years in India. Walmart India owns and operates 20 Best Price Modern wholesale stores in eight states across India. The first store opened in Amritsar in May 2009.
Wal-Mart is committed to India and we are excited about our growth plans. We will continue to focus on the cash-and-carry format as we are very happy with the way it has shaped up in the last few years. The format is also poised to grow in India and we would like to serve the growing customer base by opening 50 new cash-and-carry stores over the next 4-5 years and extend the e-commerce platform to our cash-and-carry members with a virtual shopping opportunity, said Scott Price, president & CEO, Walmart Asia.
Wal-Mart has become the first traditional or brick-and-mortar retailer in India to setup an online marketplace model. They have done this in the US before and are different from eBay or Amazon, said Arvind Singhal, CMD of advisory firm Technopak.
As for the brick-and-mortar expansion of the company, Wal-Mart's presence in India was majorly hit after it ended its cash-and-carry venture with Bharti Retail last year.
After the split, the company made a number of management changes and finally appointed Krish Iyer as the president and CEO in December.