Wal-Mart's India sales dip 32% in 2014

The Indian unit of Wal-Mart Stores Inc, the world's largest retailer, posted its first ever sales decline after parting ways with key client Bharti Retail and halting store expansion amid an ongoing internal probe into alleged corrupt practices.
Wal-Mart’s India sales dip 32% in 2014

 The Indian unit of Wal-Mart Stores Inc, the world's largest retailer, posted its first ever sales decline after parting ways with key client Bharti Retail and halting store expansion amid an ongoing internal probe into alleged corrupt practices. Wal-Mart India's revenue dropped 32 per cent to Rs 2,992.7 crore in the year ended December 2014. With no new stores opened during the year, the wholesale company narrowed its loss to Rs 232 crore, according to filings with the Registrar of Companies.
"The company supplied nearly a third of its merchandise to EasyDay stores owned by Bharti Retail. With the joint venture getting dissolved in 2013, Wal-Mart sold goods only to traders, institutions and kiranas last year, impacting overall sales," said an official who didn't wish to be identified.
About two years ago, Wal-Mart agreed to buy Bharti's 50 per cent stake in their wholesale business that operated Best Price Modern Wholesale stores and terminated franchise and supply agreements related to almost 200 EasyDay retail stores.
"This sales figure comparisons are not for like-for-like operations due to transition during the period under review," said Rajneesh Kumar, vice president & head, corporate affairs, at Wal-Mart India. Experts also attribute the drop in sales to other factors. Rival Metro AG, which had not been able to capitalise on its first-mover advantage, became aggressive after its German parent said it wants to step up expansion in India and have 50 wholesale stores in the country by 2020, up from about 18 now. Metro Cash & Carry India incurred a loss of Rs 142 crore on a turnover ofRs 3,439.9 crore for 2013-14.
"Wal-Mart does bulk buying efficiently but it is located on the outskirts of cities, while Metro has an advantage of having wholesale centres closer to the end consumer. Also, local ecommerce players, even in wholesale, have been offering huge discounts, which has impacted large retailers," said Ruchi Sally, director of retail consultancy firm Elargir.

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