Date:07/08/2007 URL: http://www.thehindu.com/2007/08/07/stories/2007080772301600.htm

Business

Bharti, Wal-mart form wholesale venture

Staff Reporter

To source products from small farmers, manufacturers

Photo: V. V. Krishnan

CASH AND CARRY: Rajan Bharti Mittal (left), Managing Director, Bharti Enterprises, with Raj Jain, Country President for Wal-Mart’s operations in India, at a press conference in New Delhi on Monday. —

NEW DELHI: After long deliberations, Bharti Enterprises and Wal-Mart Stores Inc. on Monday announced a 50:50 joint venture to form Bharti Wal-Mart Private Limited for their wholesale cash-and-carry and back-end supply chain management operations in India.

Through the new venture, the company would serve neighbourhood kirana stores, fruit and vegetable resellers, restaurants and caterers and other business owners, besides catering to the needs of other retailers including Bharti Retail, which would be soon be opening its stores in India.

Announcing the tie-up here, Bharti Enterprises Managing Director Rajan Mittal said the new venture would provide small retailers and other business owners a wide range of quality products at competitive wholesale prices help them to grow their businesses and increase profitability.

According to Raj Jain, Country President for Wal-Mart’s operations in India: “One of the key reasons for Wal-Mart’s international success is the fact that in every location where we operate, we are local. We source local products from local suppliers that appeal to local tastes, needs and fashions. As a wholesale cash-and-carry business, our endeavour is to work with and develop local suppliers and create local beneficiaries along the supply chain. We hope that big and small retailers and businesses will be our customers who will take advantage from the efficiencies we provide and derive significant benefits for their businesses.”

B2B model

Giving details about their business-to-business (B2B) model, Mr. Mittal said the new company would source products from small farmers, artisans and small manufacturers and help them find market for their products. Mr. Mittal also informed that Bharti Enterprises’ 100 per cent subsidiary Bharti Retail had entered into a franchise agreement with Wal-Mart which would provide technical support to Bharti Retail.

Stating that the first wholesale cash-and-carry facility is targeted to open by the end of 2008, Mr. Jain said: “Over the next five to seven years, the venture is expected to open 10 to 15 wholesale cash-and-carry facilities and employ approximately 5,000. A typical facility will stand between 50,000 and one-lakh sq. ft. and sell a wide range of fruits and vegetables, groceries and staples, stationery, footwear, clothing, consumer durables and other general merchandise items.”