Project On Bharti Wal-Mart

Competitors Submitted to Mr. Dinesh Mr. Rahul K Mishra Submit by: Raghav Kapoor PGP20125605

Transforming Retail in India

Retailing in India is one of the pillars of its economy and accounts for 14 to 15 percent of its GDP. The Indian retail market is estimated to be US$ 450 billion and one of the top five retail markets in the world by economic value. India is one of the fastest growing retail markets in the world, with 1.2 billion people. India's retailing industry is essentially owner manned small shops. In 2010, larger format convenience stores and supermarkets accounted for about 4 percent of the industry, and these were present only in large urban centers. India's retail and logistics industry employs about 40 million Indians (3.3% of Indian population). The Indian retailing trade is at an inflection point, and set to enter a brand new growth mechanical phenomenon attributable to rising household consumption and therefore the entry of company entities. About four hundred new malls, 1,500 supermarkets and 350 department shops are presently being built in various Indian cities. With quite US$ thirty billion in investments slated within the modern retail sector of India, it becomes imperative to develop a much better understanding of the key challenges of talent management, provide chain / logistics and real estate and identify the next steps to facilitate this exponential growth and alter the policy manufacturers to formulate applicable methods. India has stepped within the exuberant age of retail. It ranks second after Russia as the most demanding destination for retailers among thirty rising markets. The 10-12% increase within the economys income will be seen clearly by the method product and services area unit being brought and sold-out. Retail Trade contributes 10-11% of Indias value. The Indian retail sector that primarily consisted of fashion accessories, textiles, clothing, and food and grocery had been extremely fragmented. This fragmented nature had attained it the uncomplimentary label, a nation of shopkeepers. According to the Indias Centre for Policy Alternatives, the retail market has been grouped under two categories: 1) Organized Retailing 2) Unorganized Retailing

Organized Retailing Organized retailing, in India, refers to trading activities undertaken by licensed retailers, that is, those who are registered for sales tax, income tax, etc. These include the publicly traded supermarkets, corporate-backed hypermarkets and retail chains, and also the privately owned large retail businesses.

Unorganized Retailing Unorganized retailing, on the other hand, refers to the traditional formats of lowcost retailing, for example, the local corner shops, owner manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc. A big shift within the Indian shopper mental attitude started in 2000 and accelerated before long once world brands started flooding Indian markets. The Indian trade was taken by total surprise once shoppers embraced this type of alternative and commenced perceiving variations in quality among competitive merchandise. Consumers were getting down to demand organized retail experiences the same as those in developed economies. International retailers were quite happy to fulfil these wishes. However, Indias strict regulation excluded foreign players from the retail business, denying retailers like Wal-Mart individual entry into the market. So as to guard the sustenance of around fifteen million smallstore homeowners that were a lot of nearer to the buyer finish of the availability chain, foreign direct investment (FDI) was solely permissible within the wholesale business. As of 2006, the government of Republic of India permissible fifty one FDI in multi-brand retailers and 100 percent FDI in wholesale payment and back-end supplying.11 Single-brand retailers like Toyota, Nike, Lladr, Fendi and Louis Vuitton were allowed to control as they weren't seen as having an on the spot impact on the preponderantly native, tiny stores.

Wal-Mart
Wal-Mart Stores, Inc., branded as Walmart, is an American multinational retail corporation that runs chains of enormous discount shops and warehouse stores. The company is the world's third largest public corporation, per the Fortune world five hundred list in 2012, the most important nonpublic leader within the world with over 2 million workers, and is the largest retailer within the world. Walmart remains a family-owned business, because the company is controlled by the Walton family, who own a 48% stake in Walmart. Its also one amongst the world's most respected corporations. Walmart has 8,500 stores in fifteen countries, under fifty five completely different names. The corporate operates under the Walmart name within the United States, including the fifty states and Puerto Rico. It operates in Mexico as Walmex, in the united kingdom as Asda, in Japan as Seiyu, and in India as Best value. Its whole owned operations in Argentina, Brazil, and Canada. Walmart's investments outside North America have had mixed results: its operations within the United Kingdom, South America, and China are extremely successful, whereas ventures in Germany and South Korea were unsuccessful. The company was incorporated as Wal-Mart Stores, Inc. on October 31, 1969. In 1970, it opened its home office and first distribution center in Bentonville, Arkansas. It had 38 stores operating with 1,500 employees and sales of $44.2 million. It began trading stock as a publicly held company on October 1, 1970, and was soon listed on the New York Stock Exchange. The first stock split occurred in May 1971 at a market price of $47. By this time, Walmart was operating in five states: Arkansas, Kansas, Louisiana, Missouri, and Oklahoma; it entered Tennessee in 1973 and Kentucky and Mississippi in 1974. As it moved into Texas in 1975, there were 125 stores with 7,500 employees and total sales of $340.3 million. Walmart opened its first Texas store in Mount Pleasant on November 11, 1975.

Bharti Enterprises
Bharti Enterprises is an Indian business conglomerate headquartered in New Delhi, India. It was founded in 1976 by Sunil Bharti Mittal and it operates in 20 countries across Asia and Africa. Bharti Enterprises owns various businesses spanning across telecommunications, retail, financial services and manufacturing. The company was founded by Sunil Bharti Mittal along with his two siblings in 1976. The company started with manufacturing bicycles before diversifying into various sectors. It entered into telecommunications industry in 1995. Bharti is present in various sectors with the largest revenue contribution coming from telecom industry. Following are some of those:
1) 2) 3) 4) 5)

Bharti Airtel Bharti Infratel Bharti Retail Bharti Walmart Bharti AXA General Insurance and Life Insurance, etc.

Bharti-Walmart Joint Venture

Bharti Walmart Private Limited is a joint venture between Bharti Enterprises, one of India's leading business groups with interests in telecom, agri-business, insurance and retail, and Walmart, the worlds leading retailer, renowned for its efficiency and expertise in logistics, supply chain management and sourcing. The joint venture is establishing wholesale cash-and-carry stores and back-end supply chain management operations in line with Government of India guidelines. Under the agreement, Bharti and Walmart hold 50:50 stakes in Bharti Walmart Private Limited. The first Wholesale Cash-and-carry facility named "Best Price Modern Wholesale" Opened in Amritsar in May 2009 and subsequently in Zirakpur (Near Chandigarh), Jalandhar, Kota, Bhopal, Ludhiana, Raipur, Indore, Vijayawada,

Meerut, Agra, Lucknow, Jammu, Guntur, Aurangabad, Bathinda, Amravati, Hyderabad and Rajahmundry.

Porters Five Forces Analysis of Wal-Mart

Substitute Products Walmart ensures that the customers get what they what under one roof. There are very less layers in the market who provides products with this convenience and at this good prices. Also, the development of the online store gave an advantage to the customers of varieties and the price comparisons.

Potential Competitors watching the entry barriers in market, entry barriers area unit relatively elevated. This is often because Wal-Mart has set-up exceptional distribution systems. This is often supported by the companys locations, sturdy brand, and an assets that competitors and potential competitors might realize laborious to interrupt.

Industry Rivalry Among time-honored Companies In the consumer retailers sector, there are 3 giant corporations that are presently operational within the same market as Wal-Mart. These corporations include Sears, Target and K mart. Among these firms, Target is the main company within the retail business. Target has mature over the years in their domestic market; the company has clearly outlined its niche and is extremely effective in implementing its business model. On the opposite hand, Sears and K-Mart do not present a serious challenge to Wal-Mart. watching the business generally, it's clear that the retail market is mature. In general, contender rivalry is medium.

The Bargaining Power of Buyers Wal-Mart is a well established company with store placed in major places of the globe. The individual buyer doesn't have much negotiation power on WalMart. within the past, consumer lobby teams have expressed their anger regarding Wal-Marts pricing methods. The company has also faced criticism relating to its workplace practices. As a result, customers would prefer to shop at alternative stores, however, by doing so; they lose the convenience of Wal-Mart stores.

Bargaining Power of Suppliers: The power is Low to Medium Wal-Mart enjoys a major part of the market share, their business is wide and therefore they provide an oversized range of companies to manufacturers and suppliers. this provides the company an upper hand over its suppliers. If the company simply threatens to modify to an alternate provider, it might leave the present provider in panic mode. In addition, Wal-Mart has the chance of vertically integrating. The company doesn't deal with major suppliers like CocaCola and Proctor & Gamble who could have more negotiation power as compared to tiny suppliers.

SWOT Analysis of Walmart

Strengths 1) Joint Venture with Bharti 2) Located at different parts of the world 3) A new innovative service Weakness 1) Spread in various sectors like food, clothing, stationary etc. so might not be flexible enough to focus on all of its competitors 2) Lack in home consumer sales Opportunities 1) Can spread more in international market 2) Merge with many other companies like merged with Bharti in India Threats 1) Being the number one can mean the target of the competition 2) Its a global retailer so can face some political issues