Following the $16 billion acquisition of Indian e-commerce firm Flipkart, American retail giant Walmart's India investment plan is unlikely to get impacted, according to a media report.
Walmart India's Chief Executive Krish Iyer told The Economic Times that the company is investing as planned as far as Cash & Carry business – both brick and mortar and e-commerce – is concerned.
“Cash & Carry business in India has a big potential. Over the next 10 years, it is estimated that the overall retail trade will be around $1.8 trillion, out of which $1.2 trillion will be traditional trade and around $600 billion will be modern trade,” Iyer was quoted as saying by the newspaper.
The company said that it would invest about $500 million (about Rs 3,200 crore at the current exchange rate) to open another 47 stores by 2022 to take the total number of outlets to 70.
Iyer said that out of the 23 B2B Cash and Carry stores, 19 have achieved break-even with over a million members.
The global retail giant, which opened its 23rd wholesale store in Visakhapatnam on Wednesday, is in the process of setting up a second store in Visakhapatnam and discussions are underway for land.
"A typical store needs anywhere between $9 to $10 million in terms of investment. We are planning to take the total number of stores to 70 by 2022. That is the plan and we will also have e-commerce space in all the stores. So you can do the math. Yes, it needs $500 million," Iyer told PTI.
Walmart India became a wholly owned subsidiary of Walmart Inc after it severed and exited from the failed Joint Venture with Bharti Enterprises in 2014.
Iyer said the company also has plans to increase fulfilment centres across the country.
Iyer said the current contribution of private labels to overall sales was in single digits and he expected it to grow to about 20 percent in the next two to three years.
On the possible cannibalisation of sales by its recently acquired Flipkart, he said both are in different segments.
While Flipkart focuses on individual customers, Walmart provides B2B service, he said.
With inputs from PTI
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Updated Date: Nov 01, 2018 16:46:31 IST