World's largest retailer Walmart, in an apparent sign of reducing its physical presence in India, has sacked or is in the process of sacking between 50 to 100 executives. The move underscores the struggles Walmart has faced in expanding its wholesale business in India.
The firings mostly affected executives in the company’s real estate division because the growth in the wholesale model has not been that robust, Reuters reported citing sources. Walmart has around 600 staff in its India head office out of a total of around 5,300 nationally. It also plans to shut down a fulfillment centre in Mumbai, amid plans to halt fresh store expansion of its cash-and-carry stores in India.
Reportedly, the retailer is trying to focus on its e-commerce business rather than physical stores. Apart from the physical stores, Walmart placed a huge bet on India in 2018 when it paid $16 billion to acquire a majority stake in India’s online marketplace Flipkart, in its biggest global acquisition. It is speculated that the focus will be on boosting sales through business-to-business and retail e-commerce. However, a Walmart spokesperson ruled out the possibility of exiting the wholesale segment.
The US-based company entered in India in 2007 by partnering with the Bharti Group in the wholesale business, in which it eventually bought with a 50 per cent stake. It currently operates 28 wholesale stores where it sells goods to small shopkeepers, and not to retail consumers. However, despite completing more than a decade in India, the world's largest retailer is yet to acquire a strong foothold in the wholesale market that is currently dominated by Metro.
“We are always looking for ways to operate more effectively to serve our members. This requires us to review our corporate structure to ensure that we are organised in the right way to best meet the needs of our members,” a Walmart India spokesperson told The Economic Times.