Why Walmart May Fail in India? Essay Example
Why Walmart may fail in India?
Harshika Soni
University of Redlands INTB 694W
Individual Article Analysis
Wal-Mart coming to India is been a big issue lately. For several years, the Government of India did not allow international retailing giants to make foreign direct investment (FDI) in its retailing industry-for the fear that they would hurt small Indian retailers and cause unemployment and displacement of millions of people and their families. The large percent of Indian population depends upon small businesses for their livelihood. Indian government is facing the protest from Indian public for permitting foreign supermarkets to open in India for the first time for e.g. Wal-Mart (September 20th, 2012). It is argued that Walmart arrival would threaten the survival of India’s small shopowners. There are mixed feelings about accepting and welcoming major internation retail stores. India’s big businesses are assumed to be benefited by opening of the retail sector. Since overseas retailers will likely be required to have local partners, giving Indian companies room to negotiate tie ups as they can’t sell directly to consumers.The joint venture will operate in retail areas such as, cash-and-carry , which are approved by the government for foreign direct investment. A typical cash-and-carry store will occupy 50,000-100,000 sq feet, considering that such sizes are not feasible in city centers and like any other countries in the world including US, all Wal-Mart stores are located at-least 10 kilometers away from the city center, where it is cheaper to set up stores. In America, most of the people own cars, they buy grocery over the weekend and get themselves supplies for every month. Well in contrast, in India a very small percent of Indians own car, thereby reducing down a huge percent of buyers who would like to flock to this huge discount retail shops. Although buyers like the pricing of
Harshika Soni
University of Redlands INTB 694W
Individual Article Analysis
Wal-Mart coming to India is been a big issue lately. For several years, the Government of India did not allow international retailing giants to make foreign direct investment (FDI) in its retailing industry-for the fear that they would hurt small Indian retailers and cause unemployment and displacement of millions of people and their families. The large percent of Indian population depends upon small businesses for their livelihood. Indian government is facing the protest from Indian public for permitting foreign supermarkets to open in India for the first time for e.g. Wal-Mart (September 20th, 2012). It is argued that Walmart arrival would threaten the survival of India’s small shopowners. There are mixed feelings about accepting and welcoming major internation retail stores. India’s big businesses are assumed to be benefited by opening of the retail sector. Since overseas retailers will likely be required to have local partners, giving Indian companies room to negotiate tie ups as they can’t sell directly to consumers.The joint venture will operate in retail areas such as, cash-and-carry , which are approved by the government for foreign direct investment. A typical cash-and-carry store will occupy 50,000-100,000 sq feet, considering that such sizes are not feasible in city centers and like any other countries in the world including US, all Wal-Mart stores are located at-least 10 kilometers away from the city center, where it is cheaper to set up stores. In America, most of the people own cars, they buy grocery over the weekend and get themselves supplies for every month. Well in contrast, in India a very small percent of Indians own car, thereby reducing down a huge percent of buyers who would like to flock to this huge discount retail shops. Although buyers like the pricing of