As Walmart extends its reach around the globe, some observers are very skeptical and consider it as an "assault" or "invasion." Using Walmart in India as an example discuss all impacting factors
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Global retailers who would like to go to India will face a variety of challenges. The term organized retailing is used to describe the activity by large multi-store chains such as Woolworths, Tesco, and Walmart. Walmart utilizes a variety of retail formats, including discount stores and supercenters that feature a full line of groceries and general merchandise. As one of the chief executives of one supplier noted, "Walmart is going to change the retailing landscape internationally exactly the same way it's done domestically." In India, strict government regulations once meant that the retail market was essentially closed to foreigners, but that situation is now changing. Walmart began by operating a liaison office in India from which it conducted market research and lobbied Indian policy makers. India's annual retail market is worth $500 billion, and analysts expect the retail sector to grow at a rate of 7 percent over the next few years. Today, more than 90 percent of retail activity is generated by small shops, newspaper kiosks, and tea stalls.
Regulatory reforms passed in fall 2012 will finally allow Walmart and other foreign big-box retailers to sell directly to consumers. Yet, despite Walmart's potential to transform India's retail sector for the better, some observers have concerns about the company's presence there. Western style retailing is anathema to many Indian activists and policy-makers, who fear that Walmart will drive some of India's millions of shopkeepers out of business. Legislators are also suspicious of the company's motives, an attitude that can be traced back to the colonial era and the operations of the British East India Company. Perhaps, they fear, the foreigners will raise prices after they have driven small operators out of business.
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