Walmart Stores has moved Arvind Mediratta, chief operating officer of its Indian unit, to the US retail business as a senior vice president, according to two company officials familiar with the matter. Mediratta will be based at the headquarters of the world’s largest retailer in Bentonville, Arkansas, said the people who asked not to be identified as they aren’t authorized to speak with the media.
The Indian executive’s move comes a month after Walmart picked Asia chief Greg Foran to head its US business replacing Bill Simon. Foran inherited a chain wedded to an outdated big- box model, struggling to boost sales in its stores and online, and losing customers because it can’t keep shelves adequately stocked. The role of the COO in India was a remnant of the company’s former joint venture with Bharti Enterprises Pvt. and is unlikely to be replaced, one of the persons said. The US retailer terminated its six-year partnership with Bharti in October last year, choosing instead to focus on its network of wholesale-only stores.
In India, Walmart operates 20 wholesale stores where only registered traders can shop. The company plans to add 50 more in the country over the next four to five years and started a website in June to allow its business customers to order online.
India’s government opened the retail sector for foreign investment almost two years ago, and Tesco Plc is the only foreign retailer that has sought a license to run supermarkets selling multiple brands. International retailers need a local partner to run supermarkets and Walmart faced a setback to its plans when it ended the joint venture with billionaire Sunil Mittal’s Bharti.
Other global companies also face troubles in the world’s second most populous country. Carrefour SA, France’s biggest retailer, said last month it plans to close its five Indian wholesale stores, ending its four-year presence in the south Asian nation. Groupe Auchan SA, another French supermarket operator, this month ended its franchise agreement with billionaire Micky Jagtiani’s Landmark Group, which ran a chain of 13 hypermarkets in cities including Bengaluru, Delhi and Pune.
Even as retailers struggle to make profits, the country’s e-commerce sector is witnessing rapid growth. Local market leader Flipkart.com and rival Amazon.com Inc. in July outlined investments of $ 1 billion and $ 2 billion respectively, as they seek to tap a market which CLSA Asia Pacific Markets projects will grow sevenfold to $ 22 billion by 2018.