Name : Raj Jain
Are Indian customers ready for the Wal-Mart experience?
Title: President, Wal-Mart India, MD & CEO, Bharti Wal-Mart Ltd.
Career: Joined Wal-Mart in May 2006 in Shanghai as president for emerging markets. Spearheaded Wal-Mart’s entry into India. Earlier, worked with Whirlpool for 10 years in different capacities.
Education: MBA from Kellogg School of Business; graduation from Delhi College of Engineering
Interests: A keen golfer and an avid traveller
Indian consumers tend to prefer fresh food more than frozen. They are extremely value-conscious and they need multiple price points for everything. The premium segment in India is small. Land is expensive and hence the store needs to be lot more compact. We factored all that in.How have you tweaked your model for India?
We have introduced home delivery. Buyers have the option of calling and placing the orders. We have transporters who are on the campus and they can transport the stuff to the place. Traders can do that. Will traders who are used to receiving credit from existing wholesalers come to Wal-Mart?
All the research we have done on our customer base tells us that while credit is important, price is more important. Also, we have tied up with Kotak Mahindra Bank for credit cards. We have their branch on our premises and our buyers can buy stuff on credit card.How can you improve on-shelf availability when suppliers don’t adhere to delivery norms?
We are working on on-time delivery. We are trying to reduce some of the challenges end-to-end in procuring our products. Whatever it takes, we will invest in the back-end as we scale-up to 10-15 stores in the next three years.Won’t the absence of an established supply chain in India make it difficult for you to compete?
We have been working on streamlining the supply chain for 18 months now. The Indian supply chain is geared towards traditional trade. We have invested in food safety, food traceability so that it could be transported in conditions that are safe and also traceable. For example, if something goes wrong — we can actually trace the product up to the batch, the route it took and get specific information. The supplier base in India is fragmented. How did you bring them together?
If you look at our suppliers they are of three kinds - first are the MNCs like P&G, HUL, Colgates of the world. We are used to working with them. Then, we had Indian suppliers who had no exposure to organised retailing, though they have the resources. This took lot more time, needed investments and training. Then there are the regional suppliers like the pickle and papad makers. They needed a lot of hand-holding. We do a due diligence, we vet their process etc, evaluate their food safety process
(This story appears in the 19 June, 2009 issue of Forbes India. You can buy our tablet version from Magzter.com. To visit our Archives, click here.)