{"id":5795,"date":"2018-05-30T02:30:00","date_gmt":"2018-05-30T02:30:00","guid":{"rendered":"https:\/\/www.thirdeyesight.in\/?p=5795"},"modified":"2022-11-15T02:46:10","modified_gmt":"2022-11-15T02:46:10","slug":"walmart-to-steer-clear-of-food-only-retailing-for-now","status":"publish","type":"post","link":"https:\/\/myechoproject.com\/TES\/walmart-to-steer-clear-of-food-only-retailing-for-now\/","title":{"rendered":"Walmart to steer clear of food-only retailing for now"},"content":{"rendered":"\n<p>Written By Chaitali Chakravarty &#038; Rasul Bailay, ET Bureau<\/p>\n\n<div class=\"row\"><div class=\"col-sm-3\">\n<img decoding=\"async\" data-src=\"https:\/\/www.thirdeyesight.in\/wp-content\/uploads\/2022\/11\/walmart-agencies.webp\" class=\"img-fluid lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\">\n<\/div>\n<div class=\"col-sm-9\">\n<p>NEW DELHI: Even after acquiring India\u2019s largest ecommerce company Flipkart, Walmart will stay away from applying to invest in a food-only retailing venture in the immediate future that will allow the US giant to stock and sell groceries directly to consumers through the online platform.<br><br>\n\nWalmart would rather have a presence in the food products market through third-party retailers on Flipkart and escape the scrutiny and riders associated with foreign direct investment of up to 100% in food-only retailing ventures, according to sources.<\/p>\n<\/div><\/div>\n<p>\u201cIt doesn\u2019t make sense to sell only food either through brick-and-mortar or through online,\u201d said a person familiar with Walmart\u2019s plans. \u201cWith all those riders, it is even harder to do it.\u201d Walmart\u2019s strategy is in contrast to arch rival Amazon, which received government approval last year for a fully owned food retailing subsidiary that the Seattle-based ecommerce behemoth is yet to start. Amazon\u2019s plans hit a hurdle after the government asked it to keep separate equipment, machinery and warehouses for the food products business and not to mix or share anything with its flagship marketplace business Amazon.in.<br><br>\n\nWalmart has always maintained that a food-only brick-and-mortar venture doesn\u2019t make business sense because of the wafer-thin margins.<br><br>\n\n\u201cWalmart would rather handle the back-end of the food and grocery and that will help it escape the scrutiny and riders associated with food FDI retailing,\u201d the source said.<br><br>\n\nA spokesperson for Walmart declined to comment.<br><br>\n\nA company like Walmart is not in a rush because it is in India for the long term, according to <a data-ga-onclick=\"Inarticle articleshow link click#Industry#href\" href=\"\/topic\/devangshu-dutta\" target=\"_blank\" rel=\"noopener\">Devangshu Dutta<\/a> , chief executive officer of retail consultant Third Eyesight.<br><br>\n\n\u201cThey are looking at India as a longterm game \u2014 if it may not happen now, it will happen two years down the line when the regulations become friendly,\u201d he said. \u201cIf you are in for the long haul, you are not in a rush as the window of opportunity is not closing.\u201d<br><br>\n\nIndia created the food-retailing segment in 2016, allowing full ownership by overseas companies in ventures that could sell locally produced and packaged food items through offline and online channels. However, it set riders for applicants such as keeping logistics, manpower, accounting and offices, among others, at arm\u2019s length from their existing ecommerce marketplaces. India also permits 100% foreign capital in online marketplaces, which can only be offered as platforms for other vendors and retailers to do business.<br><br>\n\nThe government had banked on global retail giants such as Walmart and Tesco to lap up the new investment opportunity in food retailing, especially after the 2012 policy allowing 51% FDI in multibrand retailing remained a virtual nonstarter due to stiff riders.<br><br>\n\nWhile most global bigwigs shied away from investing in the high-profile foodonly retail ventures, Amazon appeared as a saviour in February last year, when it applied to invest $500 million through this route.<br><br>\n\nAmazon has now sought a clarification from the <a data-ga-onclick=\"Inarticle articleshow link click#Industry#href\" href=\"\/topic\/department-of-industrial-policy-and-promotion\" target=\"_blank\" rel=\"noopener\">Department of Industrial Policy and Promotion<\/a>  on whether it can share some of its warehouse staff, entry and exit doors at warehouses, barcode machines, trollies, pallets and other logistical paraphernalia for its food-only venture with the existing infrastructure of Amazon.in, ET reported in April.<br><br>\n\nIt has also asked the department if it can maintain the segregation \u201cvirtually.\u201d<br><br>\n\nA top foreign retail consultant said Walmart would rather wait until India allows such ventures to sell non-food items like soaps, toothpastes and personal care items to make the business viable for store operators.\n<\/p>\n\n\n<p>Source: <a href=\"https:\/\/economictimes.indiatimes.com\/industry\/services\/retail\/walmart-to-steer-clear-of-food-only-retailing-for-now\/articleshow\/64378028.cms\" target=\"_blank\" rel=\"noopener\">economictimes<\/a><\/p>\n\n\n\n\n","protected":false},"excerpt":{"rendered":"<p>Written By Chaitali Chakravarty &#038; Rasul Bailay, ET Bureau NEW DELHI: Even after acquiring India\u2019s largest ecommerce company Flipkart, Walmart will stay away from applying to invest in a food-only retailing venture in the immediate future that will allow the US giant to stock and sell groceries directly to consumers through the online platform. Walmart [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[3],"tags":[],"class_list":["post-5795","post","type-post","status-publish","format-standard","hentry","category-press-quotes"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Walmart to steer clear of food-only retailing for now - Third Eyesight<\/title>\n<meta name=\"robots\" content=\"index,follow\" \/>\n<link rel=\"canonical\" href=\"https:\/\/myechoproject.com\/TES\/walmart-to-steer-clear-of-food-only-retailing-for-now\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Walmart to steer clear of food-only retailing for now - Third Eyesight\" \/>\n<meta property=\"og:description\" content=\"Written By Chaitali Chakravarty &#038; Rasul Bailay, ET Bureau NEW DELHI: Even after acquiring India\u2019s largest ecommerce company Flipkart, Walmart will stay away from applying to invest in a food-only retailing venture in the immediate future that will allow the US giant to stock and sell groceries directly to consumers through the online platform. 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