B2B Payments

Walmart Expands Its India B2B eCommerce Presence

Walmart’s ambitions to be a viable B2B supplier in India continue to grow, as two more of the megaretailer’s Best Price Modern Wholesale stores are set to add eCommerce-service support, in Guntur and Vijayawada in Andhra Pradesh. The stores reportedly will begin supporting eCommerce sales on Oct. 1, providing members with 24-hour delivery access.

The company, which estimates India’s wholesale market to grow to $700 billion by 2020 from $300 billion currently, initially brought B2B eCommerce options to India in July, but only to registered members of its Best Price wholesale, cash-and-carry stores in the Indian cities of Hyderabad and Lucknow.

At the time, Walmart India’s President and CEO Krish Iyer told Reuters that his company can address a $50 billion market out of the total $300 billion worth Indian wholesale market. The Wall Street Journal also at the time reported that Wal-Mart had to slow its expansion in India because restrictions on foreign investment made it difficult for the company to be competitive. For example, Walmart is allowed to retail in the country only as cash-and-carry, not as a multi-brand retailer.

Plenty of items

According to the HinduBusinessLine.com, members of Best Price Wholesale stores in Guntur and Vijayawada will be able to shop and book orders online.

“As a virtual store, the eCommerce platform will provide a similar assortment of products as the brick-and-mortar Best Price Modern Wholesale stores, including select variety of fresh fruits and vegetables introduced recently,” the news source said.

On its website, Best Price Wholesale says its mission is to “Enable small businesses to prosper.” It provides thousands of items to its members, which include resellers, offices and institutions, and hotels, restaurants and caterers.

Room for growth

In a statement, Iyer said: “We will now be extending our B2B eCommerce channel to members of Best Price stores based in Guntur and Vijayawada. Given the tremendous support from our members for this initiative, we will continue to extend this in a phased manner to our other stores as well.”

Walmart India operates 20 Best Price Modern Wholesale stores in nine states across India. It opened its first wholesale cash-and-carry store in Amritsar in May 2009.

India’s B2B eCommerce market appears to be heating up. As PYMNTS.com reported earlier this month, Amazon reportedly is set to launch a wholesale portal for merchants in India that would be similar to AmazonSupply, where customers can, through the Login and Pay function, establish a payment relationship with a seller in as few as three taps. There also is no need to fill out long forms or enter payment credentials.

Competition rising

The India initiative, which Amazon wouldn’t confirm, could launch early next year, according to the Economic Times.

“The (Amazon) India team has been working on this top-secret project for the past few months. Talks with potential suppliers and the hiring process have begun,” the Times article noted, citing an unnamed source. “It will be similar to what Walmart is doing online in India and what Alibaba does in China.”

Amazon introduced its online retail business in India in 2013. According to the Times article, the wholesale platform in India would target small and midsize enterprises. Amazon has set up a network of seven warehouses India and has over 8,500 merchants selling products in more 28 categories on its platform, the news source said.

And then, of course, there’s Alibaba, China’s online marketplace that last week conducted the world’s largest initial public offering. Most of Alibaba’s revenue comes from domestic sales in China, as trade volume from its online cross-border trading platform AliExpress totaled just $2.4 billion in 2013. That said, Alibaba’s cross-border business is growing rapidly in some countries, as it brought in $4.5 billion in sales fiscal 2014 ended June 30, Alibaba executives reportedly told investors.

As PYMNTS.com reported on Saturday (Sept. 20), Alibaba says growth in sales for its AliExpress online marketplace, created in 2010 to facilitate sales to foreign customers from Chinese businesses, comes from the increasing number of buyers. Though most foreign buyers using AliExpress are from the United States, Russia and Brazil, Alibaba theoretically could invest more heavily in other foreign initiatives, including in India, to drive more growth in its international endeavors.

However, Alibaba’s  B2B eCommerce model has continued to struggle to find a foothold in India, and it’s not alone. Even local players such as Snapdeal and Flipkart reportedly have seemed curiously uninteresting in India’s B2B eCommerce market.

 

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