Follow palashbiswaskl on Twitter

Saturday, November 17, 2012

Amidst FDI crusade, retail major Wal-Mart has engaged the corporate government in yet another scam.Giving a major setback to already jolted Congress from the charges of corruption, the World's biggest retail company has revealed that company is investigating alleged violations of the US anti-bribery law in India.

Amidst FDI crusade, retail major Wal-Mart  has engaged the corporate government in yet another scam.Giving a major setback to already jolted Congress from the charges of corruption, the World's biggest retail company has revealed that company is investigating alleged violations of the US anti-bribery law in India.

Indian Holocaust My Father`s Life and Time, Chapter: Nine Hundred Twenty Five

Palash Biswas

Mobile: 919903717833

Skype ID: palash.biswas44


Amidst FDI crusade, retail major Wal-Mart  has engaged the corporate government in yet another scam.Giving a major setback to already jolted Congress from the charges of corruption, the World's biggest retail company has revealed that company is investigating alleged violations of the US anti-bribery law in India.The disclosure is likely to provide ammunition to political parties that are planning to corner the government on its decision to allow FDI in multi-brand retail when Parliament reconvenes next week for the winter session.Indian authorities are investigating claims that Wal-Mart Stores Inc. (WMT.N) violated foreign exchange rules when it invested $100 million in a domestic unit owned by its wholesale joint-venture partner, Bharti Enterprises, a law enforcement official said.A lawmaker first raised the allegations in a letter to the prime minister in early September, and the complaint was subsequently passed from one government department to another without action being taken.Earlier this year, The New York Times published a blockbuster story reporting that Wal-Mart had relied on bribes to build its fast-growing business in Mexico and that the company had then covered this practice up. In response to the paper's inquiries, Wal-Mart launched an investigation into what happened, which is ongoing.

And now, in an SEC filing, Wal-Mart has announced that it has expanded its bribery investigation to other countries, including China, India and Brazil.

Although many people feel that bribes are simply a cost of doing business in some countries, bribery would be a violation of the Foreign Corrupt Practices Act. It would also not be in keeping with the brand image Wal-Mart wants to project. So the findings of its investigation could lead to another splash of mud on Wal-Mart's image.

But does the investigation really matter to the stock price [WMT  68.03    -0.69  (-1%)   ]?

No, says Yahoo! Senior Columnist Michael Santoli.

Whatever price Wal-Mart will have to pay for violating the FCPA, the price will likely be small in relation to the company's profits. And the investigation is also old news that won't likely have an impact on on Wal-Mart's future results.

What Wal-Mart investors care most about are Wal-Mart's future earnings. And the reason Wal-Mart's stock has dropped in recent weeks, Santoli says.

This new allegation has given the opportunity to major party in opposition Bhartiya Janta Party (BJP) chances of attack.Taking the advantage of the situation, BJP has started to attack on Congress. A day after the enforcement directorate (ED) said that it will soon issue notices to US retail major Wal-Mart for alleged violation of forex laws of the country, finance minister P Chidambaram today said that a formal report is yet to be presented to him regarding the details of the investigation.Wal-Mart on Thursday reported that its investigation into violations of a federal anti-bribery law had extended beyond Mexico to China, India and Brazil, some of the retailer's most important international markets. The disclosure, made in a regulatory filing, suggests Wal-Mart has uncovered evidence into potential violations of the Foreign Corrupt Practices Act, as the fallout continues from a bribery scheme involving the opening of stores in Mexico that was the subject of a New York Times investigation in April. The announcement underscores the degree to which Wal-Mart recognises that corruption may have infected its international operations, and reflects a growing alarm among the company's internal investigators. People with knowledge of the matter described how a relatively routine compliance audit rapidly transformed into a full-blown investigation late last year — involving hundreds of lawyers and three former federal prosecutors — when the company learned that The Times was examining problems with its operations in Mexico.New York Times reports.

Wal-Mart is broadening an investigation into potential violations of U.S. anti-corruption laws by the chain's international operations. The probe started in Mexico, but Wal-Mart said it has added China, India and Brazil.American companies operating abroad are subject to the Foreign Corrupt Practices Act, a law that is intended to deter bribery but which has many legal gray areas. Just this week, the Justice Department tried to clarify critical portions of the FCPA -- to mixed reviews.

Enforcement Directorate is investigating allegations that Wal-Mart Stores violated foreign exchange rules when it invested $100 million into a domestic unit owned by its wholesale joint-venture partner.

The decision to Enforcement Directorate probe Wal-Mart comes after a member of Parliament wrote to the Prime Minister earlier this year, raising allegations of potential violations of investment rules, and the complaint was subsequently passed from one government department to another.

The MP had accused Wal-Mart of clandestinely and illegally investing $100 million in the multi-brand retail business of its wholesale joint venture partner, Bharti Enterprises, as early as 2010, before India allowed foreign companies to operate front-end stores.

BJP spokesperson Shahnawaz Hussain told to media that according to the new revelation by Wal-Mart the government's aim behind introducing FDI (Foreign Direct Investment) is not for the welfare of the people, but to earn money for themselves. It is very serious allegation and the government must answer to the people of the country.

"Congress will have to answer that why there is allegation of corruptions on each and every step taken by this UPA Government," said Hussain.

Taunting at the Congress' claims advocating FDI, he said, "The government is making statements, holding rally in favour of FDI in retail, and on the other hand Wal-Mart has alleged that they were asked money to allow FDI. We haven't ever thought that the government will go to this level."

Senior BJP leader Rajnath Singh said, "There is no shortage of resources either human or natural. But, the government is not interested in utilizing domestic recourses. As far the FDI is concerned, BJP will definitely oppose it. It will not only mar the employment in retail sector but also badly affect the farmers and economy of the country."

In view of Shiv Sena Supremo Balasaheb Thackeray's death, Prime Minister Manmohan Singh cancelled dinner with BJP leaders that was to be held today.The decision to cancel dinner at PM's residence was taken on BJP's leader Sushma Swaraj's request.

Bal Thackeray breathed his last on Saturday at around 3.30pm after protracted illness at his home 'Matoshree' in suburban Mumbai. His demise was announced by his doctor Jaleel Parkar.

Thousands of Shiv Sainiks had been standing in vigil outside his home in upscale Bandra East area of Mumbai for the last 72 hours as the news got out about Thackeray's failing health.

Thackeray had been keeping unwell for some time and had been under the care of a team of doctors from the Leelavati Hospital.

Dinner diplomacy was high on the agenda of leaders of the United Progressive Alliance (UPA), for after playing host to allies on Friday. The UPA is in search of BJP's support on the issue of FDI in retail ahead of the Winter Session of Parliament.

Congress on Saturday downplayed Trinamool Congress chief Mamata Banerjee's plans to bring in a no confidence motion against the government, saying it was ready for the floor test as it has majority in Lok Sabha.

"Congress is ready to face a no confidence motion. We have majority," party spokesperson Rashid Alvi told reporters soon after Banerjee, who had parted ways with UPA in September over FDI in retail and other issues, said her party will bring a no-confidence motion on the first day of the winter session.

At the same time, Alvi suggested that the Trinamool would not be able to bring such a motion without the support of "communal forces", a reference to BJP.

"Every party is within its right to bring any motion under Parliamentary rules. If Banerjee wants to bring in a no confidence motion, we have nothing to say. But at least 50 MPs are required to bring such a motion. It is a different matter if somebody brings it by joining hands with communal forces," he said.

He stressed that the government enjoyed majority and that the Lok Sabha elections will be held on time in 2014.

In response to a question on Manmohan Singh inviting BJP leaders for dinner tonight ahead of Winter session of Parliament which has now been cancelled in view of Shiv Sena leader Bal Thackeray's death, Alvi said the Prime Minister wants to build consensus on all issues.

"We have tried to build consensus on FDI because we think it is in the interest of the nation," he said.

The Indian Express reported that among those invited were senior BJP leader LK Advani, Leader of Opposition in the Lok Sabha Sushma Swaraj and her Rajya Sabha counterpart Arun Jaitley.

Amidst vociferous opposition by non-UPA parties, the dinner was seen as a last ditch effort by the Congress to ensure smooth functioning of the Winter Session.

The Monsoon Session had been washed out due to protests over corruption charges by the BJP.

The BJP is preparing to corner the government on issues like FDI in retail, corruption charges, hike in diesel price and cap on subsidised LPG cylinders during the Winter Session beginning on November 22.

The dinner invitation came in the wake of the Prime Minister's attempts to reach out to allies and outside supporters as the government faces the prospect of a motion entailing voting on FDI and even a possible threat of a No-Confidence Motion.

The Left parties have tabled a motion that will seek a vote on FDI. The main opposition BJP, its ally JD(U) as also Trinamool Congress, which parted ways with the UPA few months back on the issue, have also given notices.

Those from the Opposition who have given notices include Shatabdi Roy (TMC), Ramesh Bais, A T Nana Patil, Hansraj Ahir (all BJP) and Rajiv Ranjan Singh (JD-U).

To add to the government's discomfiture, sulking ally DMK has declined to disclose its stand on how it would vote either on such motions or the No-Confidence Motion, likely to be moved by Trinamool Congress.

On Wednesday, DMK chief M Karunanidhi said in Chennai that his party's stand on the FDI issue will be revealed later.

Asked whether DMK would support Left and some other parties' proposed resolution with provision for voting in Parliament on FDI, he had said the party's views would be made known after consultations with Parliamentary Party members.

The support of DMK, the second largest group in UPA with its 18 MPs in Lok Sabha, is crucial for the UPA in case of a voting on a motion.

At present, the government enjoys the support of about 265 MPs, including DMK, in a house of 545. With the support of Samajwadi Party (22) and BSP (21), the backing for the ruling coalition goes a little over 300, which is comfortable over the required 273 majority mark in Lok Sabha.

BSP and SP together or individually have not shown signs of withdrawing support so far.

Mayawati, who has hinted at the possibility of early polls, had remained vague on her party's stand on FDI issue after her lunch with the Prime Minister.

The CPI(M) on Saturday slammed the Congress in the wake of reports that the party was opposed to voting in Parliament on the motion of UPA government's decision to allow FDI in multi-brand retail.

"The Congress does not believe in democratic principles going by its reported opposition to voting on the motion tabled by the opposition parties for debate on the FDI in multi-brand retail during the winter session of parliament," CPI(M) Politburo member Ramchandra Pillai told reporters in Patna.

The Congress' opposition to division for voting on the FDI issue also indicated its assessment of the UPA government lacking majority in parliament, he said.

Pillai said that the CPI(M)-led left parties will persist with the demand on debate on FDI in retail in Parliament under the rule mandating voting and said that talks were going on with like-minded parties to muster support on the issue in the house and outside.

The left parties will also raise corruption issues like irregularities in the coal blocks' allotment, 2G scam and related matters during the winter session of Parliament as these issues could not be discussed and debated during the monsoon session, the CPI(M) Politburo member said.

Pillai further charged the UPA government with colluding with the corporates for sale of spectrum at an under-priced value during the recent auction and said that the latter did so with a motive to discredit the CAG.

The country did not get the fair price for the spectrum as the UPA government colluded with the corporates and gave away the precious resources at throwaway price to the bidders, he said.

According to media reports Wal-Mart has said that the company is making inquiries or investigations regarding allegations of potential Foreign Corrupt Practices Act ( FCPA ) violations in a number of foreign markets where they operate including India, China and Brazil.

"Since the implementation of the global review and enhanced anti-corruption compliance programs, the company has identified or been made aware of additional allegations regarding potential FCPA (Foreign Corrupt Practices Act) violations. When allegations are reported or identified, we, together with our third party advisors, conduct inquiries and when warranted, we open investigations," Wal-Mart said in a statement late on Thursday.

"We have inquiries or investigations regarding allegations of potential FCPA violations in a number of foreign markets where we operate regarding FCPA allegations, including but not limited to Brazil, China and India. This is in addition to the ongoing investigation in Mexico," the company said.

The disclosure, made in a regulatory filing, suggests Walmart has uncovered evidence into potential violations of FCPA, as the fallout continues from a bribery scheme involving the opening of stores in Mexico that was the subject of a New York Times investigation in April.

Internal probe unrelated to FDI lawsuits: Wal-Mart

Walmart's disclosure that it is investigating alleged violations of the US anti-bribery law does not necessarily mean that it has definitely paid bribes in China, India and Brazil, New York Times has quoted an unnamed source as saying. "But it did indicate that the company had found enough evidence to justify concern about its business practices in the three countries — concerns that go beyond initial inquires and that are serious enough that shareholders need to be told," the newspaper said.

It also said that the Justice Department and the Securities & Exchange Commission are also looking into the company's compliance with the anti-bribery law. The FCPA treats payment of bribes or offering inducements by US companies and individuals or even foreign companies listed on US stock exchanges as an offence. The law enacted over a decade ago was part of a global drive against corrupt practices and money laundering.

When contacted, a Walmart India spokesperson declined to comment on specific allegations until investigations are concluded by the company. "This investigation is unrelated to recently publicized public interest lawsuits related to claims that Walmart is in violation of FDI laws," the spokesperson said in an email to TOI. The BJP said the latest disclosure by the US retailer makes the issue of allowing FDI in multi-brand retail "murkier". "We need to have answers as to why the government is in a hurry to allow FDI in multi-brand retail. There are several questions which need to be answered," said BJP spokesperson Nirmala Sitharaman.

Wal-Mart, the world's largest retailer, has denied any wrongdoing. The allegations relate to the company's complex investment through debentures -- which could later be converted to an equity stake -- at a time when direct ownership by foreign firms was prohibited.

"Yes, the Enforcement Directorate has initiated an investigation into the allegations against Wal-Mart," a senior official, who declined to be named, told Reuters on Friday.

The Enforcement Directorate, an elite agency that falls under the finance ministry, investigates financial crimes.

"The probe is at an early stage and therefore (it is) difficult to say what the outcome will be," the official said.

News of the investigation comes at a bad time for the Congress Party-led minority government, which is preparing to do battle with opponents in parliament next week over its decision to allow foreign companies into India's retail sector. The furore could derail parliamentary proceedings.

Parties opposed to the new retail policy, which include some government allies, may use the investigation to fan suspicion among supporters against foreign retailers including Wal-Mart whose entry is seen threatening the livelihoods of local mom-and-pop store owners.

Arkansas-based Wal-Mart has repeatedly denied the allegations.

"The central government has sought certain information and clarification, which has been provided by us. We are not in a position to offer further comments as the matter is before the courts," a Wal-Mart spokesman said on Friday.

India liberalised its retail sector in mid-September to allow global superstores to buy stakes in Indian companies - one of a number of big-ticket reforms passed in September by Prime Minister Manmohan Singh to revive a sluggish economy.

Previously, foreign retailers were only allowed to invest in wholesale operations.


Wal-Mart was the most vocal advocate for the change and has said it expects to open its first retail store within 18 months.

M.P. Achuthan, a member of the Communist Party of India that opposes foreign direct investment in retail, accused Wal-Mart of investing $100 million as early as early 2010 in a multibrand retail business.

In September, Achuthan raised the issue in parliament, questioning Wal-Mart's role in Easyday stores, which are controlled by Bharti Enterprises, its partner in a wholesale joint venture.

The commerce minister answered that Wal-Mart, via its Mauritius arm, held debentures that are convertible into a 49 percent equity stake in Cedar Support Services, the company previously known as Bharti Retail Holdings that holds Easyday.

The law enforcement official confirmed that the Enforcement Directorate was looking at Cedar.

"The main part of this investigation will be whether they (Wal-Mart) offered a credit line. They have not made an equity investment directly, but even if they offered a credit line, you cannot do that," said Harminder Sahani, managing director at Wazir Advisors, a retail consultancy.

Wal-Mart's Indian partner, Bharti Enterprises, has also denied the allegation.

"We are in complete compliance of all regulations. All details have been shared with the relevant authorities," a Bharti Enterprises spokesman said.

The news came a day after Wal-Mart reported disappointing quarterly sales and as it announced internal inquiries or investigations into bribery allegations in Brazil, China and India - additions to its original probe in Mexico.

The Indian law enforcement official said the probe was being carried out under the Foreign Exchange Management Act (FEMA), which regulates domestic currency markets, including foreign direct investments and capital transactions.

The official said the agency had asked for documents on Wal-Mart's operations in India from the RBI and the Foreign Investment Promotion Board (FIPB), which clears foreign investment proposals.

"The way company affairs work in India, very little is seen as a criminal offense. So even if there are some violations, companies are usually asked to pay a penalty and they are allowed to carry on with their business," said Sahani of Wazir Advisors.

Indian Express reports:

On Thursday, the ED had said it has received a communication from the central bank to probe the investments in Wal-Mart and notices seeking documents related to financial investments and remittances will be sent to the retailer soon.

"I have read in the paper that ED is investigating Wal-Mart. But unless, a formal report is made to me, which is not every day, I would not have the details of investigation," he told reporters at a media briefing.

The agency, which has registered a case under the Foreign Exchange Management Act, will also ask the commerce and industry ministry to furnish it with clearances that were given to the company to route the investment in 2010 in a subsidiary of Bharti ventures via a Mauritian arm.

As such, the world's largest retailer posted on its website Thursday that it is investigating allegations of corrupt practices against it in foreign markets, including India.

In March 2011, the US-based company had started a worldwide review of its policies, practices and internal controls for Foreign Corrupt Practices Act compliance.

"We have inquiries or investigations regarding allegations of potential FCPA violations in a number of foreign markets where we operate regarding FCPA allegations, including but not limited to Brazil, China and India. This is in addition to the ongoing investigation in Mexico," the company said in the statement.

The ED is conducting a probe on allegations that Wal-Mart put money into the domestic multi-brand retail chain despite a ban on foreign direct investment in the sector, a charge strongly denied by Bharti Enterprise, the joint-venture partner of the US retail company.

The Rs 455.8 crore investment by Wal-Mart in Cedar Support Services Ltd, a subsidiary of Bharti Ventures, had come under attack from CPI Rajya Sabha member MP Achuthan, who wrote to Prime Minister Manmohan Singh earlier, saying it was "illegal" and flouted FDI rules.

New York Times reports:

A person with direct knowledge of the company's internal investigation cautioned that Thursday's disclosure did not mean Wal-Mart had concluded it had paid bribes in China, India and Brazil. But it did indicate that the company had found enough evidence to justify concern about its business practices in the three countries — concerns that go beyond initial inquiries and that are serious enough that shareholders needed to be told.

Wal-Mart issued a statement confirming the new disclosures, and said it would be inappropriate to comment further on the new allegations until it had concluded the investigations. The Justice Department and the Securities and Exchange Commission, with Wal-Mart's cooperation, are also looking into the company's compliance with the antibribery law.

The Times reported in April that seven years ago, Wal-Mart had found credible evidence that its Mexican subsidiary had paid bribes in its effort to build more stores, a violation of the corrupt practices act, and that an internal investigation had been suppressed by executives at the company's Arkansas headquarters. Wal-Mart has so far spent $35 million on a compliance programme that began in spring 2011, and has more than 300 outside lawyers and accountants working on it, the company said. It has spent $99 million in nine months on the current investigation.

Consequences of the expanding investigation could include slower expansion overseas and the identification of even more problems. The company said in the filing on Thursday that new inquiries had begun in countries "including but not limited to" China, India and Brazil. While the disclosure did not specify the nature of the possible bribery problems in the three countries, it "clearly will cause more scrutiny on every real estate project being considered, and one would think at the minimum it will slow down the process as more controls need to be passed through," said Colin McGranahan, an analyst with Sanford C. Bernstein.

International growth is critical to Wal-Mart, the world's largest retailer, and Brazil, India, China and Mexico make up the largest portion of the company's foreign locations.
How Widespread Are Wal-Mart's Bribery Problems?
Posted: Thursday, November 15, 2012 12:52 PM EDT
By: Michael Fowlkes

Earlier this year, Wal-Mart (WMT) came under pressure for bribery allegations in Mexico. The company has been doing an internal investigation into possible violations to the Foreign Corrupt Practices Act in Mexico, and it seems to have uncovered other violations as well.

In addition to possible violations in Mexico, the company is now investing issues in other countries, including but not limited to, China, India and Brazil.

We knew that this was coming. In May, Wal-Mart said it was looking at places other than Mexico, but thursday was the first time that it actually named countries where violations may have taken place.

Wal-Mart has long dominated the retail industry in America, but it has struggled to replicate its success internationally. The company has had a hard time growing its international presence because of the impact its massive stores and ultra-low prices have on local business owners.

In order to spur its expansion in Mexico, it is believed that Wal-Mart bribed local officials and then turned a blind eye to the actions when top executives became aware of what was taking place. Not only did Wal-Mart ignore the allegations when they first became aware of them, it actually appointed Michael Duke, who was the head of Wal-Mart's international division at the time, to be its CEO.

In many places around the world, bribery is normal part of business, but this does not excuse Wal-Mart's actions. It is pretty clear that the company has violated the law, and should be punished as a result.

This story is still developing, and by the time all the facts come out, we expect to see violations in many countries around the world, not just the four that we are already aware of.


Michael Fowlkes is a financial writer who has been with the Fresh Brewed Media family since 2004. Over the course of his tenure with Fresh Brewed Media, he has worn many hats, including portfolio manager, options analyst, and writer. Michael received his undergraduate degree from Virginia Tech in Accounting and got his start in finance working as a stock trader for six years at Chase Investment Counsel in Charlottesville, Va. His articles typically cover big-picture events and forecasting what impact they will have on the stock market. In addition to writing for Fresh Brewed Media, Michael also wrote for AOL's BloggingStocks for three years, focusing most of his attention on the energy and technology sectors.

Wal-Mart Stores Inc. reported a 9 per cent increase in net income for the third quarter, but revenue for the world's largest retailer fell below Wall Street forecasts as its low-income shoppers continue to grapple with an uncertain economy.

The discounter issued a fourth-quarter profit outlook that fell short of Wall Street expectations, and the company's stock price slid nearly 4 per cent.

Wal-Mart is considered an economic bellwether because the retailer accounts for nearly 10 per cent of nonautomotive retail spending in the U.S. The company's latest results show that many low-income Americans — it's estimated that the typical Wal-Mart customer has an average household income of between $30,000 and $60,000, rents their homes and doesn't own stock — continue to struggle even as the housing and stock markets are improving.

The disappointing revenue comes as Wal-Mart, like other retailers, is preparing for the busy winter holiday shopping season in the U.S. next week. The period, which runs roughly from November throughout December, is a time when stores can make up to 40 per cent of their annual revenue. Wal-Mart has said that it plans to offer deeper discounts and a broader assortment of merchandise during this year's season to draw in shoppers.

"Macroeconomic conditions continue to pressure our customers," said Charles Holley, Wal-Mart's chief financial officer. "The holiday season is predicted to be very competitive but we are well prepared to deliver on the value and low prices our customers expect."

The disappointing revenue results come a year after Wal-Mart's U.S. namesake business turned a corner by reemphasizing low prices and restocking stores with thousands of basic items that it had gotten rid of in an overzealous bid to reduce clutter.

During the third quarter of last year, the division reversed nine straight quarters of declines in revenue at stores opened at least a year, which is considered a key measure of a retailer's health. The U.S. namesake business has recorded five consecutive quarters of gains since the division rebounded, including a 1.5 per cent increase in the third quarter.

But the third-quarter gain is just shy of the 1.8 per cent increase analysts polled by Thomson Reuters were expecting. It's also a slowdown in growth from the 2.2 per cent gain the business posted in the second quarter and the 2.6 per cent increase it had in the first quarter.

Analysts say that Wal-Mart's previous results had benefited from the increase in prices shoppers were paying for groceries due to inflation for some items, a trend that is now subsiding. They also say that Wal-Mart is facing tougher revenue comparisons from a year ago when its business first began to rebound.

Ken Perkins, president of Retail Metrics, a research company, said Wal-Mart's revenue is headed in the right direction. But he cautioned that the company will need to continue to keep prices low in order to compete with rivals that have stepped up discounting.

"Overall, it's a relatively good report," he said. "But it shows that its consumer is still struggling."

In the third quarter, Bentonville, Ark.-based Wal-Mart earned $3.63 billion, or $1.08 per share, in the quarter ended Oct. 31. That compares with $3.33 billion, or 96 cents per share, in the year-ago period.

Net revenue, excluding Sam's Club membership fees, rose 3.4 per cent to $113.2 million. Excluding the currency impact, net revenue would have been $114.9 million. Analysts were expecting $1.07 per share on net revenue of $114 billion.

Nearly all areas, including food and clothing, registered gains. However, the company's entertainment category, which includes gaming, suffered a decline, dragged down by price deflation. Part of the weakness is also due to the company's layaway business, which winds up deferring sales to the fourth quarter.

For the entire U.S. business, sales at stores opened at least a year rose 1.7 per cent, below the 2.1 per cent Wall Street estimate. At Sam's Club, the figure was up 2.7 per cent, below the 3.8 per cent increase Wall Street expected and the 4.2 per cent gain it posted in the second quarter.

The company said its business members at Sam's Clubs are being hurt by the economic downturn, and are switching to less-expensive chicken from beef. To boost sales, Sam's Club is increasing its offering of rotisserie chicken, and has reduced prices in several varieties of apples and beauty products.

"Our business members continue to experience economic pressure and uncertainty," said Rosalind Brewer, president of Sam's Clubs.

For the full year, Wal-Mart now said it expects earnings per share to be between $4.88 per share and $4.93 per share. It originally expected earnings per share of $4.83 to $4.93. For the fourth quarter, it forecasts earnings per share to be $1.53 per share and $1.58 per share. Analysts had expected $1.59 per share.

Separately, in a filing with the U.S. Securities and Exchange Commission, Wal-Mart said Thursday that it was looking into potential violations related to the Foreign Corrupt Practices Act in Brazil, China and India. This comes after Wal-Mart initially began investigating its Mexico operations following report that surfaced in April that the retailer allegedly failed to notify law enforcement when company officials authorized millions of dollars in bribes in Mexico to speed building permits and gain other favours. The company continues to work with government officials in the U.S. and Mexico on that investigation.

On Thursday, Wal-Mart's stock fell $2.59 to close at $68.72 Thursday. Over the past 52 weeks, Wal-Mart stock has been trading between $56.26 and $77.60.

  1. News for FDI India

    1. FDI issue: PM invites BJP top brass to dinner today

    2. Zee News ‎- 11 hours ago
    3. Prime Minister Manmohan Singh will be hosting a dinner for the BJP leaders on Saturday in search of their support on the issue of FDI in retail ...
    4. Avoid voting on FDI in Parliament, DMK tells UPA at Prime Minister's dinner
    5. IBNLive‎ - 11 hours ago
    6. year ahead: expectations and apprehensions
    7. Reuters India (blog)‎ - 58 minutes ago
  2. Foreign direct investment - Wikipedia, the free encyclopedia

  4. Jump to Foreign direct investment in India‎: Starting from a baseline of less than $1 billion in 1990, a recent UNCTAD survey projected India as the ...
  5. History - Types - Methods - Global foreign direct investment
  6. FDI India

  8. India has been ranked at the second place in global foreign direct investments in 2010 and will continue to remain among the top five attractive destinations for ...
  9. Foreign Direct Investment in India, FDI in Indian Business

  11. The foreign direct investment in indian business sectors, can be hugely profitable and most secured, through imaginative services of Global Jurix.
  12. Foreign Investments in India - Reserve Bank of India

  13. FAQs
  14. Jump to Foreign Direct Investment‎: (FDI). Q. 1. What are the forms in which business can be conducted by a foreign company in India? Ans. A foreign ...
  15. OIFC : Welcome to the official website of Overseas Indian Facilitation ...

  17. Overseas Indian Facilitation Centre (OIFC) is an official website from MOIA and is a credible and unique one-stop-shop for overseas Indian and NRIs investors ...
  18. Welcome to FIPB (India)

  20. Welcome to Foreign Investment Promotion Board, INDIA. Vide Circular dated 27.06.2011, it is compulsory to fill Mandatory Preliminary Application w.e.f. 1st July ...
  21. FDI in India: Latest News, Videos, Photos | Times of India

  22. Topics
  23. See FDI in India Latest News, Photos, Biography, Videos and Wallpapers. FDI in India profile on Times of India.
  24. FDI Investment in India

  26. To view the detailed information on FDI investments in India regarding policy on NRI/ PIO investment procedures, entry options for investors, SEZ, Deposit by ...
  27. India open to tweaking FDI in aviation policy: Govt source - India ...

  29. 1 day ago – The Indian government is open to tweaking its foreign direct investment (FDI) policy in the aviation sector in order to attract investment, ...
  30. PM hosts dinner for UPA leaders; FDI discussed - Zee News - India ...

  32. 21 hours ago – Ahead of the crucial Winter Session of Parliament starting next week, PM Manmohan Singh Friday hosted a dinner for UPA leaders in a bid to ...
Searches related to FDI India
fdi india retail
fdi in retail
fdi india 2011
fdi data india
fii india
fdi india wiki
fdi india 2012

Foreign Investments in India

(Updated up to October 11, 2012)

I. Foreign Direct Investment (FDI)

Q. 1. What are the forms in which business can be conducted by a foreign company in India?
Ans. A foreign company planning to set up business operations in India may:
  • Incorporate a company under the Companies Act, 1956, as a Joint Venture or a Wholly Owned Subsidiary.
  • Set up a Liaison Office / Representative Office or a Project Office or a Branch Office of the foreign company which can undertake activities permitted under the Foreign Exchange Management (Establishment in India of Branch Office or Other Place of Business) Regulations, 2000.
Q.2. What is the procedure for receiving Foreign Direct Investment in an Indian company?
Ans. An Indian company may receive Foreign Direct Investment under the two routes as given under:
i. Automatic Route
FDI is allowed under the automatic route without prior approval either of the Government or the Reserve Bank of India in all activities/sectors as specified in the consolidated FDI Policy, issued by the Government of India from time to time.
ii. Government Route
FDI in activities not covered under the automatic route requires prior approval of the Government which are considered by the Foreign Investment Promotion Board (FIPB), Department of Economic Affairs, Ministry of Finance. Application can be made in Form FC-IL, which can be downloaded from Plain paper applications carrying all relevant details are also accepted. No fee is payable.
The Indian company having received FDI either under the Automatic route or the Government route is required to comply with provisions of the FDI policy including reporting the FDI to the Reserve Bank. as stated in Q 4.
Q.3. What are the instruments for receiving Foreign Direct Investment in an Indian company?
Ans. Foreign investment is reckoned as FDI only if the investment is made in equity shares , fully and mandatorily convertible preference shares and fully and mandatorily convertible debentures with the pricing being decided upfront as a figure or based on the formula that is decided upfront. Any foreign investment into an instrument issued by an Indian company which:
  • gives an option to the investor to convert or not to convert it into equity or
  • does not involve upfront pricing of the instrument
as a date would be reckoned as ECB and would have to comply with the ECB guidelines.
The FDI policy provides that the price/ conversion formula of convertible capital instruments should be determined upfront at the time of issue of the instruments. The price at the time of conversion should not in any case be lower than the fair value worked out, at the time of issuance of such instruments, in accordance with the extant FEMA regulations [the DCF method of valuation for the unlisted companies and valuation in terms of SEBI (ICDR) Regulations, for the listed companies].
Q.4. What are the modes of payment allowed for receiving Foreign Direct Investment in an Indian company?
Ans. An Indian company issuing shares /convertible debentures under FDI Scheme to a person resident outside India shall receive the amount of consideration required to be paid for such shares /convertible debentures by:
(i) inward remittance through normal banking channels.
(ii) debit to NRE / FCNR account of a person concerned maintained with an AD category I bank.
(iii) conversion of royalty / lump sum / technical know how fee due for payment or conversion of ECB, shall be treated as consideration for issue of shares.
(iv) conversion of import payables / pre incorporation expenses / share swap can be treated as consideration for issue of shares with the approval of FIPB.
(v) debit to non-interest bearing Escrow account in Indian Rupees in India which is opened with the approval from AD Category – I bank and is maintained with the AD Category I bank on behalf of residents and non-residents towards payment of share purchase consideration.
If the shares or convertible debentures are not issued within 180 days from the date of receipt of the inward remittance or date of debit to NRE / FCNR (B) / Escrow account, the amount shall be refunded. Further, Reserve Bank may on an application made to it and for sufficient reasons permit an Indian Company to refund / allot shares for the amount of consideration received towards issue of security if such amount is outstanding beyond the period of 180 days from the date of receipt.
Q.5. Which are the sectors where FDI is not allowed in India, both under the Automatic Route as well as under the Government Route?
Ans. FDI is prohibited under the Government Route as well as the Automatic Route in the following sectors:
i) Atomic Energy
ii) Lottery Business
iii) Gambling and Betting
iv) Business of Chit Fund
v) Nidhi Company
vi) Agricultural (excluding Floriculture, Horticulture, Development of seeds, Animal Husbandry, Pisciculture and cultivation of vegetables, mushrooms, etc. under controlled conditions and services related to agro and allied sectors) and Plantations activities (other than Tea Plantations) (c.f. Notification No. FEMA 94/2003-RB dated June 18, 2003).
vii) Housing and Real Estate business (except development of townships, construction of residen­tial/commercial premises, roads or bridges to the extent specified in Notification No. FEMA 136/2005-RB dated July 19, 2005).
viii) Trading in Transferable Development Rights (TDRs).
ix) Manufacture of cigars , cheroots, cigarillos and cigarettes , of tobacco or of tobacco substitutes.
(Please also see the the website of Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry, Government of India at for details regarding sectors and investment limits therein allowed ,under FDI)
Q.6. What is the procedure to be followed after investment is made under the Automatic Route or with Government approval?
Ans. A two-stage reporting procedure has to be followed :.
• On receipt of share application money:
Within 30 days of receipt of share application money/amount of consideration from the non-resident investor, the Indian company is required to report to the Foreign Exchange Department, Regional Office concerned of the Reserve Bank of India,under whose jurisdiction its Registered Office is located, the Advance Reporting Form, containing the following details :
  • Name and address of the foreign investor/s;
  • Date of receipt of funds and the Rupee equivalent;
  • Name and address of the authorised dealer through whom the funds have been received;
  • Details of the Government approval, if any; and
  • KYC report on the non-resident investor from the overseas bank remitting the amount of consideration.
The Indian company has to ensure that the shares are issued within 180 days from the date of inward remittance which otherwise would result in the contravention / violation of the FEMA regulations.
• Upon issue of shares to non-resident investors:
Within 30 days from the date of issue of shares, a report in Form FC-GPR- PART A together with the following documents should be filed with the Foreign Exchange Department, Regional Office concerned of the Reserve Bank of India.
• Certificate from the Company Secretary of the company accepting investment from persons resident outside India certifying that:

• The investment is within the sectoral cap / statutory ceiling permissible under the Automatic Route of the Reserve Bank and it fulfills all the conditions laid down for investments under the Automatic Route,

• OR

• Shares have been issued in terms of SIA/FIPB approval No. --------------------- dated -------------------- (enclosing the FIPB approval copy)
• Certificate from Statutory Auditors/ SEBI registered Merchant Banker / Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India.
Q.7. What are the guidelines for transfer of existing shares from non-residents to residents or residents to non-residents?
Ans. The term 'transfer' is defined under FEMA as including "sale, purchase, acquisition, mortgage, pledge, gift, loan or any other form of transfer of right, possession or lien" {Section 2 (ze) of FEMA, 1999}.
The following share transfers are allowed without the prior approval of the Reserve Bank of India
A. Transfer of shares from a Non Resident to Resident under the FDI scheme where the pricing guidelines under FEMA, 1999 are not met provided that :-
i. The original and resultant investment are in line with the extant FDI policy and FEMA regulations in terms of sectoral caps, conditionalities (such as minimum capitalization, etc.), reporting requirements, documentation, etc.;
ii. The pricing for the transaction is compliant with the specific/explicit, extant and relevant SEBI regulations / guidelines (such as IPO, Book building, block deals, delisting, exit, open offer/ substantial acquisition / SEBI SAST, buy back); and
iii. Chartered Accountants Certificate to the effect that compliance with the relevant SEBI regulations / guidelines as indicated above is attached to the form FC-TRS to be filed with the AD bank.
B. Transfer of shares from Resident to Non Resident:
i) where the transfer of shares requires the prior approval of the FIPB as per the extant FDI policy provided that :
a) the requisite approval of the FIPB has been obtained; and
b) the transfer of share adheres with the pricing guidelines and documentation requirements as specified by the Reserve Bank of India from time to time.
ii) where SEBI (SAST) guidelines are attracted subject to the adherence with the pricing guidelines and documentation requirements as specified by Reserve Bank of India from time to time.
iii) where the pricing guidelines under the Foreign Exchange Management Act (FEMA), 1999 are not met provided that:-
The resultant FDI is in compliance with the extant FDI policy and FEMA regulations in terms of sectoral caps, conditionalities (such as minimum capitalization, etc.), reporting requirements, documentation etc.; b) The pricing for the transaction is compliant with the specific/explicit, extant and relevant SEBI regulations / guidelines (such as IPO, Book building, block deals, delisting, exit, open offer/ substantial acquisition / SEBI SAST); and
Chartered Accountants Certificate to the effect that compliance with the relevant SEBI regulations / guidelines as indicated above is attached to the form FC-TRS to be filed with the AD bank.
iv) where the investee company is in the financial sector provided that :
a) NOCs are obtained from the respective financial sector regulators/ regulators of the investee company as well as transferor and transferee entities and such NOCs are filed along with the form FC-TRS with the AD bank; and
b). The FDI policy and FEMA regulations in terms of sectoral caps, conditionalities (such as minimum capitalization, etc.), reporting requirements, documentation etc., are complied with.
Where non-residents (including NRIs) make investment in an Indian company in compliance with the provisions of the Companies Act, 1956, by way of subscription to Memorandum of Association, such investments may be made at face value subject to their eligibility to invest under the FDI scheme.
Transfer of shares/ fully and mandatorily convertible debentures by way of Gift:
A person resident outside India can freely transfer shares/ fully and mandatorily convertible debentures by way of gift to a person resident in India as under:
  • Any person resident outside India, (not being a NRI or an erstwhile OCB), can transfer by way of gift the shares/ fully and mandatorily convertible debentures to any person resident outside India;
  • a NRI may transfer by way of gift, the shares/convertible debentures held by him to another NRI only,
  • Any person resident outside India may transfer share/ fully and mandatorily convertible debentures to a person resident in India by way of gift.
Q.8. Can a person resident in India transfer security by way of gift to a person resident outside India?
Ans. A person resident in India who proposes to transfer security by way of gift to a person resident outside India [other than an erstwhile OCBs] shall make an application to the Central Office of the Foreign Exchange Department, Reserve Bank of India furnishing the following information, namely:
  • Name and address of the transferor and the proposed transferee

  • Relationship between the transferor and the proposed transferee

  • Reasons for making the gift.

  • In case of Government dated securities, treasury bills and bonds, a certificate issued by a Chartered Accountant on the market value of such securities.

  • In case of units of domestic mutual funds and units of Money Market Mutual Funds, a certificate from the issuer on the Net Asset Value of such security.

  • In case of shares/ fully and mandatorily convertible debentures, a certificate from a Chartered Account on the value of such securities according to the guidelines issued by the Securities & Exchange Board of India or the Discount Free Cash Flow Cash (DCF) method with regard to listed companies and unlisted companies, respectively.

  • Certificate from the Indian company concerned certifying that the proposed transfer of shares/convertible debentures, by way of gift, from resident to the non-resident shall not breach the applicable sectoral cap/ FDI limit in the company and that the proposed number of shares/convertible debentures to be held by the non-resident transferee shall not exceed 5 per cent of the paid up capital of the company.

The transfer of security by way of gift may be permitted by the Reserve bank provided:
(i) The donee is eligible to hold such security under Schedules 1, 4 and 5 to Notification No. FEMA 20/2000-RB dated May 3, 2000, as amended from time to time.
(ii) The gift does not exceed 5 per cent of the paid up capital of the Indian company/ each series of debentures/ each mutual fund scheme
(iii) The applicable sectoral cap/ foreign direct investment limit in the Indian company is not breached
(iv) The donor and the donee are relatives as defined in section 6 of the Companies Act, 1956.
(v) The value of security to be transferred by the donor together with any security transferred to any person residing outside India as gift in the financial year does not exceed the rupee equivalent of USD 50000.
(vi) Such other conditions as considered necessary in public interest by the Reserve Bank.
Q.9. What if the transfer of shares from resident to non-resident does not fall under the above categories?
Transfer of Shares by Resident which requires Government approval
The following instances of transfer of shares from residents to non-residents by way of sale or otherwise requires Government approval:
(i) Transfer of shares of companies engaged in sector falling under the Government Route.
(ii) Transfer of shares resulting in foreign investments in the Indian company, breaching the sectoral cap applicable.
Prior permission of the Reserve Bank in certain cases for acquisition / transfer of security
i) Transfer of shares or convertible debentures from residents to non-residents by way of sale requires prior approval of Reserve Bank in case where the non-resident acquirer proposes deferment of payment of the amount of consideration. Further, in case approval is granted for the transaction, the same should be reported in Form FC-TRS to the AD Category – I bank, within 60 days from the date of receipt of the full and final amount of consideration.
(ii) A person resident in India, who intends to transfer any security, by way of gift to a person resident outside India, has to obtain prior approval from the Reserve Bank.
Any other case not covered by by General Permission.
Q 10. What are the reporting obligations in case of transfer of shares between resident and non-resident ?
Ans. The transaction should be reported by submission of form FC-TRS to the AD Category – I bank, within 60 days from the date of receipt/remittance of the amount of consideration. The onus of submission of the form FC-TRS within the given timeframe would be on the resident in India, the transferor or transferee, as the case may be.
Q.11. What is the method of payment and remittance/credit of sale proceeds in case of transfer of shares between resident and non-resident?
Ans. The sale consideration in respect of the shares purchased by a person resident outside India shall be remitted to India through normal banking channels. In case the buyer is a Foreign Institutional Investor (FII), payment should be made by debit to its Special Non-Resident Rupee Account. In case the buyer is a NRI, the payment may be made by way of debit to his NRE/FCNR (B) accounts. However, if the shares are acquired on non-repatriation basis by NRI, the consideration shall be remitted to India through normal banking channel or paid out of funds held in NRE/FCNR (B)/NRO accounts.
The sale proceeds of shares (net of taxes) sold by a person resident outside India) may be remitted outside India. In case of FII the sale proceeds may be credited to its special Non-Resident Rupee Account. In case of NRI, if the shares sold were held on repatriation basis, the sale proceeds (net of taxes) may be credited to his NRE/FCNR(B) accounts and if the shares sold were held on non repatriation basis, the sale proceeds may be credited to his NRO account subject to payment of taxes. The sale proceeds of shares (net of taxes) sold by an erstwhile OCB may be remitted outside India directly if the shares were held on repatriation basis and if the shares sold were held on non-repatriation basis, the sale proceeds may be credited to its NRO (Current) Account subject to payment of taxes, except in the case of erstwhile OCBs whose accounts have been blocked by Reserve Bank.
Q. 12. Are the investments and profits earned in India repatriable?
Ans. All foreign investments are freely repatriable (net of applicable taxes) except in cases where:
i) the foreign investment is in a sector like Construction and Development Projects and Defence wherein the foreign investment is subject to a lock-in-period; and
ii) NRIs choose to invest specifically under non-repatriable schemes.
Further, dividends (net of applicable taxes) declared on foreign investments can be remitted freely through an Authorised Dealer bank.
Q.13. What are the guidelines on issue and valuation of shares in case of existing companies?
A. The price of shares issued to persons resident outside India under the FDI Scheme shall not be less than :
(i) the price worked out in accordance with the SEBI guidelines, as applicable, where the shares of the company is listed on any recognised stock exchange in India;
(ii) the fair valuation of shares done by a SEBI registered Category - I Merchant Banker or a Chartered Accountant as per the discounted free cash flow method, where the shares of the company is not listed on any recognised stock exchange in India; and
(iii) the price as applicable to transfer of shares from resident to non-resident as per the pricing guidelines laid down by the Reserve Bank from time to time, where the issue of shares is on preferential allotment.
B. The price of shares transferred from resident to a non-resident and vice versa should be determined as under:
i) Transfer of shares from a resident to a non-resident:
a) In case of listed shares, at a price which is not less than the price at which a preferential allotment of shares would be made under SEBI guidelines.
b) In case of unlisted shares at a price which is not less than the fair value as per the Discount Free Cash Flow (DCF) Method to be determined by a SEBI registered Category-I- Merchant Banker/Chartered Accountant.
ii) Transfer of shares from a non-resident to a resident - The price should not be more than the minimum price at which the transfer of shares would have been made from a resident to a non-resident.
In any case, the price per share arrived at as per the above method should be certified by a SEBI registered Category-I-Merchant Banker / Chartered Accountant.
Q. 14. What are the regulations pertaining to issue of ADRs/ GDRs by Indian companies?
  • Indian companies can raise foreign currency resources abroad through the issue of ADRs/ GDRs, in accordance with the Scheme for issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 and guidelines issued by the Government of India thereunder from time to time.
  • A company can issue ADRs / GDRs, if it is eligible to issue shares to persons resident outside India under the FDI Scheme. However, an Indian listed company, which is not eligible to raise funds from the Indian Capital Market including a company which has been restrained from accessing the securities market by the Securities and Exchange Board of India (SEBI) will not be eligible to issue ADRs/GDRs.
  • Unlisted companies, which have not yet accessed the ADR/GDR route for raising capital in the international market, would require prior or simultaneous listing in the domestic market, while seeking to issue such overseas instruments. Unlisted companies, which have already issued ADRs/GDRs in the international market, have to list in the domestic market on making profit or within three years of such issue of ADRs/GDRs, whichever is earlier.
  • After the issue of ADRs/GDRs, the company has to file a return in Form DR as indicated in the RBI Notification No. FEMA.20/ 2000-RB dated May 3, 2000, as amended from time to time. The company is also required to file a quarterly return in Form DR- Quarterly as indicated in the RBI Notification ibid.
  • There are no end-use restrictions on GDR/ADR issue proceeds, except for an express ban on investment in real estate and stock markets.
  • Erstwhile OCBs which are not eligible to invest in India and entities prohibited to buy, sell or deal in securities by SEBI will not be eligible to subscribe to ADRs / GDRs issued by Indian companies.
  • The pricing of ADR / GDR issues including sponsored ADRs / GDRs should be made at a price determined under the provisions of the Scheme of issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 and guidelines issued by the Government of India and directions issued by the Reserve Bank, from time to time.
Q.15. What is meant by Sponsored ADR & Two-way fungibility Scheme of ADR/ GDR?
Ans. Sponsored ADR/GDR: An Indian company may sponsor an issue of ADR/ GDR with an overseas depository against shares held by its shareholders at a price to be determined by the Lead Manager. The operative guidelines for the same have been issued vide A.P. (DIR Series) Circular No.52 dated November 23, 2002.
Two-way fungibility Scheme: Under the limited Two-way fungibility Scheme, a registered broker in India can purchase shares of an Indian company on behalf of a person resident outside India for the purpose of converting the shares so purchased into ADRs/ GDRs. The operative guidelines for the same have been issued vide A.P. (DIR Series) Circular No.21 dated February 13, 2002. The Scheme provides for purchase and re-conversion of only as many shares into ADRs/ GDRs which are equal to or less than the number of shares emerging on surrender of ADRs/ GDRs which have been actually sold in the market. Thus, it is only a limited two-way fungibility wherein the headroom available for fresh purchase of shares from domestic market is restricted to the number of converted shares sold in the domestic market by non-resident investors. So long the ADRs/ GDRs are quoted at discount to the value of shares in domestic market, an investor will gain by converting the ADRs/ GDRs into underlying shares and selling them in the domestic market. In case of ADRs/ GDRs being quoted at premium, there will be demand for reverse fungibility, i.e. purchase of shares in domestic market for re-conversion into ADRs/ GDRs. The scheme is operationalised through the Custodians of securities and stock brokers under SEBI.
Q.16. Can Indian companies issue Foreign Currency Convertible Bonds (FCCBs)?
Ans. FCCBs can be issued by Indian companies in the overseas market in accordance with the Scheme for Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993.
The FCCB being a debt security, the issue needs to conform to the External Commercial Borrowing guidelines, issued by RBI vide Notification No. FEMA 3/2000-RB dated May 3, 2000, as amended from time to time.
Q.17. Can a foreign investor invest in Preference Shares? What are the regulations applicable in case of such investments?
Ans. Yes. Foreign investment through preference shares is treated as foreign direct investment. However, the preference shares should be fully and mandatorily convertible into equity shares within a specified time to be reckoned as part of share capital under FDI. Investment in other forms of preference shares requires to comply with the ECB norms.
Q.18. Can a company issue debentures as part of FDI?
Ans. Yes. Debentures which are fully and mandatorily convertible into equity within a specified time would be reckoned as part of share capital under the FDI Policy.
Q.19. Can shares be issued against Lumpsum Fee, Royalty, ECB , Import of capital goods/ machineries / equipments (excluding second-hand machine) and Pre-operative/pre-incorporation expenses (including payments of rent)?
Ans. An Indian company eligible to issue shares under the FDI policy and subject to pricing guidelines as specified by the Reserve Bank from time to time, may issue shares to a person resident outside India :
  1. being a provider of technology / technical know-how, against Royalty / Lumpsum fees due for payment;
  2. against External Commercial Borrowing (ECB) (other than import dues deemed as ECB or Trade Credit as per RBI Guidelines).
  3. With prior approval from FIPB for against import of capital goods/ machineries / equipments and Pre-operative/pre-incorporation expenses subject to the compliance with the extant FEMA regulations and AP Dir Series 74 dated June 30,2011.
Provided, that the foreign equity in the company, after such conversion, is within the sectoral cap.
Q.20. What are the other modes of issues of shares for which general permission is available under RBI Notification No. FEMA 20 dated May 3, 2000?
  • Issue of shares under ESOP by Indian companies to its employees or employees of its joint venture or wholly owned subsidiary abroad who are resident outside India directly or through a Trust up to 5% of the paid up capital of the company.
  • Issue and acquisition of shares by non-residents after merger or de-merger or amalgamation of Indian companies.
  • Issue shares or preference shares or convertible debentures on rights basis by an Indian company to a person resident outside India.
Q.21. Can a foreign investor invest in shares issued by an unlisted company in India?
Ans. Yes. As per the regulations/guidelines issued by the Reserve Bank of India/Government of India, investment can be made in shares issued by an unlisted Indian company.
Q.22. Can a foreigner set up a partnership/ proprietorship concern in India?
Ans. No. Only NRIs/PIOs are allowed to set up partnership/proprietorship concerns in India on non-repatriation basis.
Q.23. Can a foreign investor invest in Rights shares issued by an Indian company at a discount?
Ans. There are no restrictions under FEMA for investment in Rights shares issued at a discount by an Indian company, provided the rights shares so issued are being offered at the same price to residents and non-residents. The offer on right basis to the person's resident outside India shall be:
(a) in the case of shares of a company listed on a recognized stock exchange in India, at a price as determined by the company; and
(b) in the case of shares of a company not listed on a recognized stock exchange in India, at a price which is not less than the price at which the offer on right basis is made to resident shareholders.
Q.24. Can a AD bank allow pledge of shares of an Indian company held by non-resident investor in favor of an Indian bank or an Overseas bank?
Ans Yes, the same has been allowed vide the instruction and subject to compliance with the terms and conditions as mentioned in the AP Dir Series Circular No 57 dated May 2, 2011.

II. Foreign Technology Collaboration Agreement

Whether the payment in terms of foreign technology collaboration agreement' can be made by an Authorised Dealer (AD) bank?
Ans. Yes, RBI has delegated the powers, to make payments for royalty, lumpsum fee for transfer of technology and payment for use of trademark/brand name in terms of the foreign technology collaboration agreement entered by the Indian company with its foreign partners, to the AD banks subject to compliance with the provisions of Foreign Exchange Management (Current Account Transactions) Rules, 2000. Further, the requirement of registration of the agreement with the Regional Office of Reserve Bank of India has also been done away with.

III. Foreign Portfolio Investment

Q.1. What are the regulations regarding Portfolio Investments by SEBI registered Foreign Institutional Investors (FIIs)?
  • Investment by SEBI registered FIIs is regulated under SEBI (FII) Regulations, 1995 and Regulation 5(2) of FEMA Notification No.20 dated May 3, 2000, as amended from time to time. FIIs include Asset Management Companies, Pension Funds, Mutual Funds, Investment Trusts as Nominee Companies, Incorporated / Institutional Portfolio Managers or their Power of Attorney holders, University Funds, Endowment Foundations, Charitable Trusts and Charitable Societies.
  • SEBI acts as the nodal point in the registration of FIIs. The Reserve Bank of India has granted general permission to SEBI Registered FIIs to invest in India under the Portfolio Investment Scheme (PIS).
  • Investment by SEBI registered FIIs and its sub accounts cannot exceed 10per cent of the paid up capital of the Indian company. However, in case of foreign corporates or High Networth Individuals (HNIs) registered as sub accounts of an FII, their investment shall be restricted to 5 per cent of the paid up capital of the Indian company. All FIIs and their sub-accounts taken together cannot acquire more than 24 per cent of the paid up capital of an Indian Company. An Indian company can raise the 24 per cent ceiling to the sectoral cap / statutory ceiling, as applicable, by passing a resolution by its Board of Directors followed by passing a Special Resolution to that effect by their General Body. The Indian company has to intimate the raising of the FII limit to the Reserve Bank to enable the Bank to notify the same on its website for larger public dissemination.
  • SEBI registered FIIs/sub-accounts of FIIs can invest in primary issues of Non-Convertible Debentures (NCDs)/ bonds only if listing of such bonds / NCDs is committed to be done within 15 days of such investment. In case the NCDs/bonds issued to the SEBI registered FIIs / sub-accounts of FIIs are not listed within 15 days of issuance to the SEBI registered FIIs / sub-accounts of FIIs, for any reason, then the FII/sub-account of FII shall immediately dispose of these bonds/NCDs either by way of sale to a third party or to the issuer and the terms of offer to FIIs / sub-accounts should contain a clause that the issuer of such debt securities shall immediately redeem / buyback the said securities from the FIIs/sub-accounts of FIIs in such an eventuality.
Q.2. What are the regulations regarding Portfolio Investments by NRIs/PIOs?
  • Non- Resident Indian (NRIs) and Persons of Indian Origin (PIOs) can purchase or sell shares/ fully and mandatorily convertible debentures of Indian companies on the Stock Exchanges under the Portfolio Investment Scheme. For this purpose, the NRI/ PIO has to apply to a designated branch of a bank, which deals in Portfolio Investment. All sale/ purchase transactions are to be routed through the designated branch.
  • An NRI or a PIO can purchase shares up to 5 per cent of the paid up capital of an Indian company. All NRIs/PIOs taken together cannot purchase more than 10 per cent of the paid up value of the company. This limit can be increased by the Indian company to 24 per cent by passing a General Body resolution. The Indian company has to intimate the raising of the NR Limit to the Reserve Bank to enable the Bank to notify the same on its website for larger public dissemination.
  • The sale proceeds of the repatriable investments can be credited to the NRE/ NRO, etc. accounts of the NRI/ PIO, whereas the sale proceeds of non-repatriable investment can be credited only to NRO accounts.
  • The sale of shares will be subject to payment of applicable taxes.

IV. Investment in other securities

Q.1. Can a Non-resident Indian (NRI) and SEBI registered Foreign Institutional Investor (FII)invest in Government Securities/ Treasury bills and Corporate debt?
Ans. Under the FEMA Regulations, only NRIs andSEBI registered FIIs are permitted to purchase Government Securities/Treasury bills and Corporate debt. The details are as under :
A. A Non-resident Indian can purchase without limit,
(1) on repatriation basis
i) Dated Government securities (other than bearer securities) or treasury bills or units of domestic mutual funds;
ii) Bonds issued by a public sector undertaking (PSU) in India; and
iii) Shares in Public Sector Enterprises being disinvested by the Government of India.
(2) on non-repatriation basis
i) Dated Government securities (other than bearer securities) or treasury bills or units of domestic mutual funds;
ii) Units of Money Market Mutual Funds in India; and
iii) National Plan/Savings Certificates.
B. A SEBI registered FII may purchase, on repatriation basis, dated Government securities/ treasury bills, listed non-convertible debentures/ bonds issued by an Indian company and units of domestic mutual funds either directly from the issuer of such securities or through a registered stock broker on a recognised stock exchange in India.
Purchase of debt instruments including Upper Tier II instruments issued by banks in India and denominated in Indian Rupees by FIIs are subject to limits notified by SEBI and the Reserve Bank from time to time. The present limit for investment in Corporate Debt Instruments like non-convertible debentures / bonds by FIIs is USD 45 billion , which constitutes of the:
Out of USD 45 billion, USD 25 billion is earmarked for investment in infrastructure corporate bonds and the remaining USD 20 billion is earmarked for investment in non-infrastructure corporate bonds. Out of the USD 25 billion earmarked for FIIs investment in infrastructure corporate bonds, a uniform lock-in period of one year and residual maturity of fifteen months has been prescribed for USD 22 billion investment by FIIs excluding the USD 3 billion limit earmarked for QFIs investment in mutual fund debt oriented schemes.The present limit of investment by SEBI registered FIIs in Government Securities is USD 20 billion which constitutes of :
  • USD 10 billion will be without any conditions and the remaining USD 10 billion is with the condition that the residual maturity of the instrument at the time of first purchase by FIIs should be at least three years.
Sovereign Wealth Funds (SWFs), Multilateral agencies, endowment funds, insurance funds, pension funds and foreign Central Banks to be registered with SEBI are also allowed to invest in Government securities within this enhanced limit of USD 20 billion.
Q.2. Can a NRI and SEBI registered FII invest in Tier I and Tier II instruments issued by banks in India?
Ans. SEBI registered FIIs and NRIs have been permitted to subscribe to the Perpetual Debt instruments (eligible for inclusion as Tier I capital) and Debt Capital instruments (eligible for inclusion as upper Tier II capital), issued by banks in India and denominated in Indian Rupees, subject to the following conditions:
  1. Investment by all FIIs in Rupee denominated Perpetual Debt instruments (Tier I) should not exceed an aggregate ceiling of 49 per cent of each issue and investment by individual FII should not exceed the limit of 10 per cent of each issue.
  2. Investments by all NRIs in Rupee denominated Perpetual Debt instruments (Tier I) should not exceed an aggregate ceiling of 24 per cent of each issue and investments by a single NRI should not exceed 5 percent of each issue.
  3. Investment by FIIs in Rupee denominated Debt Capital instruments (Tier II) shall be within the limits stipulated by SEBI for FII investment in corporate debt instruments.
  4. Investment by NRIs in Rupee denominated Debt Capital instruments (Tier II) shall be in accordance with the extant policy for investment by NRIs in other debt instruments.
  5. Investment by FIIs in Rupee denominated Upper Tier II Instruments raised in Indian Rupees will be within the limit prescribed by the SEBI for investment in corporate debt instruments.
  6. The details of the secondary market sales / purchases by FIIs and the NRIs in these instruments on the floor of the stock exchange are to be reported by the custodians and designated Authorised Dealer banks respectively, to the Reserve Bank through the soft copy of the Forms LEC (FII) and LEC (NRI).
Q.3. Can a NRI and SEBI registered FIIinvest in Indian Depository Receipts (IDRs)?
Ans. NRI and SEBI registered FIIs have been permitted to invest, purchase, hold and transfer IDRs of eligible companies resident outside India and issued in the Indian capital market, subject to the following conditions:
(i) The purchase, hold and transfer of IDRs is in accordance with the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000 notified vide Notification No. FEMA 20 / 2000-RB dated May 3, 2000, as amended from time to time.
A limited two way fungibility for IDRs (similar to the limited two way fungibility facility available for ADRs/GDRs) subject to the following terms and conditions:
  1. The conversion of IDRs into underlying equity shares would be governed by the conditions mentioned in paras 6 and 7 of A.P. (DIR Series) Circular No. 5 dated July 22, 2009.
  2. Fresh IDRs would continue to be issued in terms of the provisions of A.P. (DIR Series) Circular No. 5 dated July 22, 2009.
  3. The re-issuance of IDRs would be allowed only to the extent of IDRs that have been redeemed /converted into underlying shares and sold.
  4. There would be an overall cap of USD 5 billion for raising of capital by issuance of IDRs by eligible foreign companies in Indian markets. This cap would be akin to the caps imposed for FII investment in debt securities and would be monitored by SEBI.
  5. IDRs shall not be redeemable into underlying equity shares before the expiry of one year period from the date of issue of the IDRs.
  6. At the time of redemption / conversion of IDRs into the underlying shares, the Indian holders (persons resident in India) of IDRs shall comply with the provisions of the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004 notified vide Notification No. FEMA 120 / RB-2004 dated July 7 2004, as amended from time to time.
The FEMA provisions shall not apply to the holding of the underlying shares, on redemption of IDRs by the FIIs including SEBI approved sub-accounts of the FIIs and NRIs.The issuance, redemption and fungibility of IDRs would also be subject to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended from time to time as well as other relevant guidelines issued in this regard by the Government, the SEBI and the RBI from time to time.
Q.4. Can aperson resident in India invests in the Indian Depository Receipts (IDRs)? What is the procedure for redemption of IDRs held by persons resident in India?
Ans. A person resident in India may purchase, hold and transfer IDRs of eligible companies resident outside India and issued in the Indian capital market. The FEMA Regulations shall not be applicable to persons resident in India as defined under section 2(v) of FEMA, 1999, for investing in IDRs and subsequent transfer arising out of a transaction on a recognized Stock Exchange in India. However, at the time of redemption / conversion of IDRs into underlying shares, the Indian holders (persons resident in India) of IDRs shall comply with the provisions of the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004 notified vide Notification No. FEMA 120 / RB-2004 dated July 7 2004, as amended from time to time. The following guidelines shall be followed on redemption of IDRs by persons resident in India:
i. Listed Indian companies may either sell or continue to hold the underlying shares subject to the terms and conditions as per Regulations 6B and 7 of Notification No. FEMA 120/RB-2004 dated July 7, 2004, as amended from time to time.
ii. Indian Mutual Funds, registered with SEBI may either sell or continue to hold the underlying shares subject to the terms and conditions as per Regulation 6C of Notification No. FEMA 120/RB-2004 dated July 7, 2004, as amended from time to time.
iii. Other persons resident in India including resident individuals are allowed to hold the underlying shares only for the purpose of sale within a period of 30 days from the date of conversion of the IDRs into underlying shares.

V. Foreign Venture Capital Investment

What are the regulations for Foreign Venture Capital Investment?
  • A SEBI registered Foreign Venture Capital Investor has general permission from the Reserve Bank of India to invest in a Venture Capital Fund (VCF) or an Indian Venture Capital Undertaking (IVCU), in the manner and subject to the terms and conditions specified in Schedule 6 of RBI Notification No. FEMA 20/2000-RB dated May 3, 2000, as amended from time to time. These investments by SEBI registered FVCI, would be subject to the SEBI regulation and sector specific caps of FDI.
  • FVCIs can purchase equity / equity linked instruments / debt / debt instruments, debentures of an IVCU or of a VCF through initial public offer or private placement in units of schemes / funds set up by a VCF. At the time of granting approval, the Reserve Bank permits the FVCI to open a Foreign Currency Account and/ or a Rupee Account with a designated branch of an AD Category – I bank.
  • FVCIs allowed to invest in the eligible securities (equity, equity linked instruments, debt, debt instruments, debentures of an IVCU or VCF, units of schemes / funds set up by a VCF) by way of private arrangement / purchase from a third party also. FVCIs are also allowed to invest in securities on a recognized stock exchange.
  • The purchase / sale of shares, debentures and units can be at a price that is mutually acceptable to the buyer and the seller.
  • AD Category – I banks can offer forward cover to FVCIs to the extent of total inward remittance. In case the FVCI has made any remittance by liquidating some investments, original cost of the investments has to be deducted from the eligible cover to arrive at the actual cover that can be offered.

VI. Branch/ Project/ Liaison Office of a foreign company in India

Q.1. How can foreign companies open Liaison /Branch office in India?
A. With effect from February 1, 2010, foreign companies/entities desirous of setting up of Liaison Office / Branch Office (LO/BO) are required to submit their application in Form FNC along with the documents mentioned therein to Foreign Investment Division, Foreign Exchange Department, Reserve Bank of India, Central Office, Mumbai through an Authorised Dealer bank. This form is available at
B. The applications from such entities in Form FNC will be considered by the Reserve Bank under two routes:
• Reserve Bank Route - Where principal business of the foreign entity falls under sectors where 100 per cent Foreign Direct Investment (FDI) is permissible under the automatic route.
• Government Route - Where principal business of the foreign entity falls under the sectors where 100 per cent FDI is not permissible under the automatic route. Applications from entities falling under this category and those from Non - Government Organisations / Non - Profit Organisations / Government Bodies / Departments are considered by the Reserve Bank in consultation with the Ministry of Finance, Government of India.
C. The following additional criteria are also considered by the Reserve Bank while sanctioning Liaison/Branch Offices of foreign entities:
• Track Record
  • For Branch Office — a profit making track record during the immediately preceding five financial years in the home country.
  • For Liaison Office — a profit making track record during the immediately preceding three financial years in the home country.
• Net Worth [total of paid-up capital and free reserves, less intangible assets as per the latest Audited Balance Sheet or Account Statement certified by a Certified Public Accountant or any Registered Accounts Practitioner by whatever name].
  • For Branch Office — not less than USD 100,000 or its equivalent.
  • For Liaison Office — not less than USD 50,000 or its equivalent.
D. Permission to set up such offices is initially granted for a period of 3 years and this may be extended from time to time by the Authorised Dealer in whose jurisdiction the office is set up. The Branch / Liaison offices established with the Reserve Bank's approval will be allotted a Unique Identification Number (UIN) ( ). The BOs / LOs shall also obtain Permanent Account Number (PAN) from the Income Tax Authorities on setting up the offices in India.
E. Liaison/Branch offices have to file an Annual Activity Certificate (AACs) from the Auditors, as at end of March 31, along with the audited Balance Sheet on or before September 30 of that year, stating that the Liaison Office has undertaken only those activities permitted by Reserve Bank of India. In case the annual accounts of the LO/ BO are finalized with reference to a date other than March 31, the AAC along with the audited Balance Sheet may be submitted within six months from the due date of the Balance Sheet.
Q.2. What are the permitted activities of Liaison Office/ Representative Office?
Ans. A Liaison Office (also known as Representative Office) can undertake only liaison activities, i.e. it can act as a channel of communication between Head Office abroad and parties in India. It is not allowed to undertake any business activity in India and cannot earn any income in India. Expenses of such offices are to be met entirely through inward remittances of foreign exchange from the Head Office outside India. The role of such offices is, therefore, limited to collecting information about possible market opportunities and providing information about the company and its products to the prospective Indian customers. A Liaison Office can undertake the following activities in India:
i. Representing in India the parent company / group compa­nies.
ii. Promoting export / import from / to India.
iii Promoting technical/financial collaborations be­tween parent/group companies and companies in India.
iv. Acting as a communication channel between the parent company and Indian companies.
Q.3. Can Foreign Insurance Companies / Banks set up Liaison Office in India?
Ans. Foreign Insurance companies can establish Liaison Offices in India only after obtaining approval from the Insurance Regulatory and Development Authority (IRDA). Similarly, foreign banks can establish Liaison Offices in India only after obtaining approval from the Department of Banking Operations and Development (DBOD), Reserve Bank of India.
Q. 4. What is the procedure for setting up Branch office?
Ans. Permission for setting up branch offices is granted by the Foreign Exchange Department, Reserve Bank of India, Central Office, Mumbai. Reserve Bank of India considers the track record of the applicant company, existing trade relations with India, the activity of the company proposing to set up office in India as well as the financial position of the company while scrutinising the application. The application in Form FNC should be submitted to the Reserve Bank through the Authorised Dealer bank.
Q.5. What are the permitted activities of Branch Office?
Ans. Companies incorporated outside India and engaged in manufacturing or trading activities are allowed to set up Branch Offices in India with specific approval of the Reserve Bank. Such Branch Offices are permitted to represent the parent / group companies and undertake the following activities in India:
  1. Export / Import of goods.1
  2. Rendering professional or consultancy services.
  3. Carrying out research work, in areas in which the parent company is engaged.
  4. Promoting technical or financial collaborations between Indian companies and parent or overseas group company.
  5. Representing the parent company in India and acting as buying / selling agent in India.
  6. Rendering services in information technology and devel­opment of software in India.
  7. Rendering technical support to the products sup­plied by parent/group companies.
  8. Foreign airline / shipping company.
Normally, the Branch Office should be engaged in the activity in which the parent company is engaged.
  1. Retail trading activities of any nature is not allowed for a Branch Office in India.
  2. A Branch Office is not allowed to carry out manufacturing or processing activities in India, directly or indirectly.
  3. Profits earned by the Branch Offices are freely remittable from India, subject to payment of applicable taxes.
Q.6. Whether Branch Offices are permitted to remit profit outside India?
Ans. Branch Offices are permitted to remit outside India profit of the branch net of applicable Indian taxes, on production of the following documents to the satisfaction of the Authorised Dealer through whom the remittance is effected :
a. A Certified copy of the audited Balance Sheet and Profit and Loss account for the relevant year;
b. A Chartered Accountant's certificate certifying -
i. the manner of arriving at the remittable profit
ii. that the entire remittable profit has been earned by undertaking the permitted activities
iii. that the profit does not include any profit on revaluation of the assets of the branch.
Q.7 What are the documents to be submitted to the AD bank at the time of closure of the Liaison/ Branch Office?
Ans. At the time of winding up of Branch/Liaison offices, the company has to approach the designated AD Category - I bank with the following documents:
a) Copy of the Reserve Bank's permission/ approval from the sectoral regulator(s) for establishing the BO / LO.
b) Auditor's certificate - i) indicating the manner in which the remittable amount has been arrived at and supported by a statement of assets and liabilities of the applicant, and indicating the manner of disposal of assets;
ii) confirming that all liabilities in India including arrears of gratuity and other benefits to employees, etc., of the Office have been either fully met or adequately provided for; and
iii) confirming that no income accruing from sources outside India (including proceeds of exports) has remained un-repatriated to India.
c) No-objection / Tax Clearance Certificate from Income-Tax authority for the remittance/s.
d) Confirmation from the applicant/parent company that no legal proceedings in any Court in India are pending and there is no legal impediment to the remittance.
e) A report from the Registrar of Companies regarding compliance with the provisions of the Companies Act, 1956, in case of winding up of the Office in India.
f) Any other document/s, specified by the Reserve Bank while granting approval.
Q.8. What is the procedure for setting up Project Office?
Ans. The Reserve Bank has granted general permission to foreign companies to establish Project Offices in India, provided they have secured a contract from an Indian company to execute a project in India, and
  1. the project is funded directly by inward remittance from abroad; or
  2. the project is funded by a bilateral or multilateral International Financing Agency; or
  3. the project has been cleared by an appropriate authority; or
  4. a company or entity in India awarding the contract has been granted Term Loan by a Public Financial Institution or a bank in India for the project.
However, if the above criteria are not met or if the parent entity is established in Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran or China, such applications have to be forwarded to the Foreign Exchange Department, Reserve Bank of India, Central Office, Mumbai for approval.
Q.9. What are the bank accounts permitted to a Project Office?
Ans. AD Category – I banks can open non-interest bearing Foreign Currency Account for Project Offices in India subject to the following:
  1. The Project Office has been established in India, with the general / specific permission of Reserve Bank, having the requisite approval from the concerned Project Sanctioning Authority concerned.
  2. The contract, under which the project has been sanctioned, specifically provides for payment in foreign currency.
  3. Each Project Office can open two Foreign Currency Accounts, usually one denominated in USD and other in home currency, provided both are maintained with the same AD category–I bank.
  4. The permissible debits to the account shall be payment of project related expenditure and credits shall be foreign currency receipts from the Project Sanctioning Authority, and remittances from parent/ group company abroad or bilateral / multilateral international financing agency.
  5. The responsibility of ensuring that only the approved debits and credits are allowed in the Foreign Currency Account shall rest solely with the branch concerned of the AD. Further, the Accounts shall be subject to 100 per cent scrutiny by the Concurrent Auditor of the respective AD banks.
  6. The Foreign Currency accounts have to be closed at the completion of the Project.
Q.10. What are the general conditions applicable to Liaison / Branch / Project Office of foreign entities in India?
Ans. The general conditions applicable to Liaison/Branch/Project Office of foreign entities in India are as under;
(i) Without prior permission of the Reserve Bank, no person being a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran or China can establish in India, a Branch or a Liaison Office or a Project Office or any other place of business.
(ii) Partnership / Proprietary concerns set up abroad are not allowed to establish Branch /Liaison/Project Offices in India.
(iii) Entities from Nepal are allowed to establish only Liaison Offices in India.
(iv) Branch/Project Offices of a foreign entity, excluding a Liaison Office are permitted to acquire property for their own use and to carry out permitted/incidental activities but not for leasing or renting out the property. However, entities from Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran, Bhutan or China are not allowed to acquire immovable property in India even for a Branch Office. These entities are allowed to lease such property for a period not exceeding five years.
(v) Branch / Liaison / Project Offices are allowed to open non-interest bearing INR current accounts in India.
(vi) Transfer of assets of Liaison / Branch Office to subsidiaries or other LO / BO or any other entity is permitted only with the specific approval of the Central Office of the Foreign Exchange Department, Reserve Bank of India.
(viii) Authorised Dealers can allow term deposit account for a period not exceeding 6 months in favor of a branch/office of a person resident outside India provided the bank is satisfied that the term deposit is out of temporary surplus funds and the branch / office furnishes an undertaking that the maturity proceeds of the term deposit will be utilised for their business in India within 3 months of maturity. However, such facility may not be extended to shipping/airline companies.
(ix) Permission to establish offices, in India by foreign Non-Government Organisations/Non-Profit Organisations/Foreign Government Bodies/Departments, by whatever name called, are under the Government Route as specified in A. P. (DIR Series) Circular No. 23 dated December 30, 2009. Such entities are required to apply to the Reserve Bank for prior permission to establish an office in India, whether Project Office or otherwise.

VII. Investment by QFIs

Q 1. What are QFIs and what are the investments they can undertake?
QFIs mean a person who fulfils the following criteria :
(a) Resident in a country that is a member of Financial Action task Force (FATF) or a member of a group which is a member of FATF; and
(b) Resident in a country that is a signatory to IOSCO's MMoU (Appendix A Signatories) or a signatory of a bilateral MoU with SEBI
PROVIDED that the person is not resident in a country listed in the public statements issued by FATF from time to time on jurisdictions having a strategic AML/CFT deficiencies to which counter measures apply or that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies;
Further such person is not resident in India and is not registered with SEBI as a Foreign Institutional Investor (FII) or Sub-Account of an FII or Foreign Venture Capital Investor (FVCI).
  1. "bilateral MoU with SEBI" shall mean a bilateral MoU between SEBI and the overseas regulator that, inter alia, provides for information sharing arrangements.
  2.  Member of FATF shall not mean an associate member of FATF.
Q2. What are the investments QFIs can undertake and what are the applicable caps for such investment?
Rupee denominated units of equity schemes of domestic MFs
The QFIs may invest in rupee denominated units of equity schemes of domestic MFs directly issued by the SEBI registered domestic MFs under the two routes, namely the Direct Route – SEBI registered Depository Participant (DP) route and the Indirect Route - Unit Confirmation Receipt (UCR) route (no secondary market purchases are allowed )
Investments by the QFIs will have a ceiling of USD 10 billion under both the routes. Units and UCRs issued under this scheme to QFIs, are non-tradable and non-transferable.
Domestic MF debt schemes which invest in infrastructure debt
QFIs are also allowed to invest (under both the routes – Direct and Indirect), up to an additional amount of USD 3 billion in units of domestic MF debt schemes which invest in infrastructure ("Infrastructure" as defined under the extant ECB guidelines) debt of minimum residual maturity of 5 years, within the existing ceiling of USD 25 billion for FII investment in corporate bonds issued by infrastructure companies.
Equity shares
QFIs are also permitted to invest through SEBI registered Depository Participants in equity shares of listed Indian companies through recognized brokers on recognized stock exchanges in India as well as in equity shares of Indian companies which are offered to public in India in terms of the relevant SEBI guidelines/regulations.
The individual and aggregate investment limits for the QFIs are 5% and 10% respectively of the paid up capital of an Indian company. These limits are over and above the FII and NRI investment ceilings prescribed under the Portfolio Investment Scheme for foreign investment in India. Further, wherever there are composite sectoral caps under the extant FDI policy, these limits for QFI investment in equity shares shall also be within such overall FDI sectoral caps.
QFIs are also permitted to acquire equity shares by way of rights shares, bonus shares or equity shares on account of stock split / consolidation or equity shares on account of amalgamation, demerger or such corporate actions subject to the investment limits prescribed below. QFIs are also allowed to sell the equity shares so acquired by way of sale
Debt securities
Qualified Foreign Investors (QFIs) have been permitted to purchase, on repatriation basis, debt securities through SEBI registered Qualified Depository Participants (QDPs) in eligible corporate debt instruments, viz. listed Non-Convertible Debentures(NCDs), listed bonds of Indian companies, listed units of Mutual Fund debt Schemes and "to be listed" corporate bonds directly from the issuer or through a registered stock broker on a recognized stock exchange in India. The provisions relating to FIIs in case of non-listing of "to be listed" corporate bonds, within 15 days as per A.P. (DIR Series) Circular No. 89 dated March 1, 2012, are applicable to QFIs.
QFIs are permitted to invest in corporate debt securities (without any lock-in or residual maturity clause) and Mutual Fund debt schemes subject to a total overall ceiling of USD 1 billion. This limit shall be over and above USD 20 billion for FII investment in corporate debt.
QFIs are also be permitted to sell 'eligible debt securities' so acquired by way of sale through registered stock broker on a recognized stock exchange in India or by way of buyback or redemption by the issuer.
Mode of payment / repatriation
A QFI may open a single non-interest bearing Rupee Account with an AD Category- I bank in India, for routing the receipt and payment for transactions relating to purchase and sale of units of domestic mutual funds, equity shares of listed Indian companies and eligible debt securities
Demat accounts - QFIs would be allowed to open a single demat account with a QDP in India for investment in all eligible debt securities under the QFI scheme.
Permissible currencies - QFIs will remit foreign inward remittance through normal banking channel in any permitted currency (freely convertible) directly into the single non-interest bearing Rupee account of the QFI maintained with an AD Category-I bank.
Pricing – The pricing of all eligible transactions and investment in all eligible securities by QFIs under this scheme shall be in accordance with the relevant and applicable guidelines issued from time to time.
Hedging – QFIs would be permitted to hedge their currency risk on account of their permissible investments (in equity and debt instruments) in terms of the guidelines issued by the Reserve Bank from time to time, similar to the facilities made available to the FIIs in the matter.
Reporting – In addition to the reporting to SEBI as may be prescribed by them, QDPs and AD Category-I banks (maintaining QFI accounts) are required to ensure reporting to the Reserve Bank of India in a manner and format as prescribed by the Reserve Bank of India from time to time.
Foreign Investments in Infrastructure Debt Funds
Investment on repatriation basis by eligible non-resident investors viz. Sovereign Wealth Funds, Multilateral Agencies, Pension Funds, Insurance Funds and Endowment Funds which are registered with SEBI as eligible non- resident investors in IDFs is allowed in Rupee and Foreign currency denominated bonds issued by the Infrastructure Debt Funds (IDFs) set up as an Indian company and registered as Non-Banking Financial Companies (NBFCs) with the Reserve Bank of India and in (ii) Rupee denominated units issued by IDFs set up as SEBI registered domestic Mutual Funds(MFs), in accordance with the terms and conditions stipulated by the SEBI and the Reserve Bank of India from time to time.
The original / initial maturity of all aforementioned securities at the time of first investment by a non resident investor is five years and subject to a lock in period of 3 years.
All non-resident investment in IDFs (other than NRIs) (in both Rupee and Foreign Currency denominated securities) are within an overall cap / limit of USD 10 billion. This cap / limit of USD 10 billion would be within the overall cap of USD 25 billion for FII investment in bonds / non convertible debentures issued by Indian companies in the infrastructure sector (where infrastructure is as defined under the extant ECB guidelines) or by Infrastructure Finance Companies (IFCs registered as NBFCs with the Reserve Bank).
The facility of foreign exchange hedging would be available to the eligible non-resident IDF investors, IDFs as well as the infrastructure project companies exposed to the foreign exchange/ currency risk
Q: What are the reporting requirements for acquisition/transfer of shares by non-residents under respective schedules to FEMA 20:
Ans: Following are the reporting requirements
(A) Reporting of FDI for fresh issuance of shares
(i) Reporting of inflow
(a) The actual inflows on account of such issuance of shares shall be reported by the AD branch in the R-returns in the normal course.
(b) An Indian company receiving investment from outside India for issuing shares / convertible debentures / preference shares under the FDI Scheme, should report the details of the amount of consideration to the Regional Office concerned of the Reserve Bank through it's AD Category I bank, not later than 30 days from the date of receipt in the Advance Reporting Form enclosed in Annex - 6. Noncompliance with the above provision would be reckoned as a contravention under
FEMA, 1999 and could attract penal provisions.
The Form can also be downloaded from the Reserve Bank's website
(c) Indian companies are required to report the details of the receipt of the amount of consideration for issue of shares / convertible debentures, through an AD Category - I bank, together with a copy/ies of the FIRC/s evidencing the receipt of the remittance along with the KYC report on the non-resident investor from the overseas bank remitting the amount. The report would be acknowledged by the Regional Office concerned, which will allot a Unique Identification Number (UIN) for the amount reported.
(ii) Time frame within which shares have to be issued
The equity instruments should be issued within 180 days from the date of receipt of the inward remittance or by debit to the NRE/FCNR (B) /Escrow account of the non-resident investor. In case, the equity instruments are not issued within 180 days from the date of receipt of the inward remittance or date of debit to the NRE/FCNR (B) account, the amount of consideration so received should be refunded immediately to the non-resident investor by outward remittance through normal banking channels or by credit to the NRE/FCNR (B)/Escrow account, as the case may be. Non-compliance with the above provision would be reckoned as a contravention under FEMA and could attract penal provisions. In exceptional cases, refund / allotment of shares for the amount of consideration outstanding beyond a period of 180 days from the date of receipt may be considered by the Reserve Bank, on the merits of the case.
(iii) Reporting of issue of shares
(a) After issue of shares (including bonus and shares issued on rights basis and shares issued on conversion of stock option under ESOP scheme)/ convertible debentures / convertible preference shares, the Indian company has to file Form FC-GPR, through it's AD Category I bank, not later than 30 days from the date of issue of shares. The Form can also be downloaded from the Reserve Bank's website
Non-compliance with the above provision would be reckoned as a contravention under FEMA and could attract penal provisions.
(b) Form FC-GPR has to be duly filled up and signed by Managing Director/Director/Secretary of the Company and submitted to the Authorised Dealer of the company, who will forward it to the concerned Regional Office of the Reserve Bank. The following documents have to be submitted along with Form FC-GPR:
(i) A certificate from the Company Secretary of the company certifying that :
a) all the requirements of the Companies Act, 1956 have been complied with;
b) terms and conditions of the Government's approval, if any, have been complied with;
c) the company is eligible to issue shares under these Regulations; and
d) the company has all original certificates issued by AD banks in India evidencing receipt of amount of consideration.
(ii) A certificate from SEBI registered Merchant Banker or Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India.
(c) The report of receipt of consideration as well as Form FC-GPR have to be submitted by the AD bank to the Regional Office concerned of the Reserve Bank under whose jurisdiction the registered office of the company is situated.
(d) Issue of bonus/rights shares or shares on conversion of stock options issued under ESOP to persons resident outside India directly or on amalgamation / merger with an existing Indian company, as well as issue of shares on conversion of ECB / royalty / lumpsum technical know-how fee / import of capital goods by units in SEZs has to be reported in Form FC-GPR.
B. Reporting of FDI for Transfer of shares route
(i) The actual inflows and outflows on account of such transfer of shares shall be reported by the AD branch in the R-returns in the normal course.
(ii) Reporting of transfer of shares between residents and non-residents and vice- versa is to be made in Form FC-TRS. The Form FC-TRS should be submitted to the AD Category – I bank, within 60 days from the date of receipt of the amount of consideration. The onus of submission of the Form FC-TRS within the given timeframe would be on the transferor / transferee, resident in India.
(iii) The sale consideration in respect of equity instruments purchased by a person resident outside India, remitted into India through normal banking channels, shall be subjected to a KYC check (Annex 9-ii) by the remittance receiving AD Category – I bank at the time of receipt of funds. In case, the remittance receiving AD Category – I bank is different from the AD Category - I bank handling the transfer transaction, the KYC check should be carried out by the remittance receiving bank and the KYC report be submitted by the customer to the AD Category – I bank carrying out the transaction along with the Form FC-TRS.
(iv) The AD bank should scrutinise the transactions and on being satisfied about the transactions should certify the form FC-TRS as being in order.
(v) The AD bank branch should submit two copies of the Form FC-TRS received from their constituents/customers together with the statement of inflows/outflows on account of remittances received/made in connection with transfer of shares, by way of sale, to IBD/FED/or the nodal office designated for the purpose by the bank in the proforma (which is to be prepared in MS-Excel format). The IBD/FED or the nodal office of the bank will consolidate reporting in respect of all the transactions reported by their branches into two statements inflow and outflow statement. These statements (inflow and outflow) should be forwarded on a monthly basis to Foreign Exchange Department, Reserve Bank, Foreign Investment Division, Central Office, Mumbai in soft copy (in MS- Excel) by e-mail. The bank should maintain the FC-TRS forms with it and should not forward the same to the Reserve Bank of India.
(vi) The transferee/his duly appointed agent should approach the investee company to record the transfer in their books along with the certificate in the Form FC-TRS from the AD branch that the remittances have been received by the transferor/payment has been made by the transferee. On receipt of the certificate from the AD, the company may record the transfer in its books.
(vi) On receipt of statements from the AD bank , the Reserve Bank may call for such additional details or give such directions as required from the transferor/transferee or their agents, if need be.
C. Reporting of conversion of ECB into equity
Details of issue of shares against conversion of ECB have to be reported to the Regional Office concerned of the Reserve Bank, as indicated below:
  1. In case of full conversion of ECB into equity, the company shall report the conversion in Form FC-GPR to the Regional Office concerned of the Reserve Bank as well as in Form ECB-2 to the Department of Statistics and Information Management (DSIM), Reserve Bank of India, Bandra-Kurla Complex, Mumbai – 400 051, within seven working days from the close of month to which it relates. The words "ECB wholly converted to equity" shall be clearly indicated on top of the Form ECB-2. Once reported, filing of Form ECB-2 in the subsequent months is not necessary.
  2. In case of partial conversion of ECB, the company shall report the converted portion in Form FC-GPR to the Regional Office concerned as well as in Form ECB-2 clearly differentiating the converted portion from the non-converted portion. The words "ECB partially converted to equity" shall be indicated on top of the Form ECB-2. In the subsequent months, the outstanding balance of ECB shall be reported in Form ECB-2 to DSIM.
  3. The SEZ unit issuing equity as mentioned in para (iii) above, should report the particulars of the shares issued in the Form FC-GPR.
D. Reporting of ESOPs for allotment of equity shares
The issuing company is required to report the details of issuance of ESOPs to its employees to the Regional Office concerned of the Reserve Bank, in plain paper reporting, within 30 days from the date of issue of ESOPs. Further, at the time of conversion of options into shares the Indian company has to ensure reporting to the Regional Office concerned of the Reserve Bank in form FC-GPR, within 30 days of allotment of such shares. However, provision with regard to advance reporting would not be applicable for such issuances.
E. Reporting of ADR/GDR Issues
The Indian company issuing ADRs / GDRs has to furnish to the Reserve Bank, full details of such issue in the Form enclosed in Annex -10, within 30 days from the date of closing of the issue. The company should also furnish a quarterly return in the prescribed Form, to the Reserve Bank within 15 days of the close of the calendar quarter. The quarterly return has to be submitted till the entire amount raised through ADR/GDR mechanism is either repatriated to India or utilized abroad as per the extant Reserve Bank guidelines.
F. Reporting of FII investments under PIS scheme
(i) FII reporting: The AD Category – I banks have to ensure that the FIIs registered with SEBI who are purchasing various securities (except derivative and IDRs) by debit to the Special Non-Resident Rupee Account should report all such transactions details (except derivative and IDRs) in the Form LEC (FII) to Foreign Exchange Department, Reserve Bank of India, Central Office by uploading the same to the ORFS web site ( It would be the banks responsibility to ensure that the data submitted to RBI is reconciled by periodically taking a FII holding report for their bank.
(iii) The Indian company which has issued shares to FIIs under the FDI Scheme (for which the payment has been received directly into company's account) and the Portfolio Investment Scheme (for which the payment has been received from FIIs' account maintained with an AD Category – I bank in India) should report these figures separately under item no. 5 of Form FC-GPR (Annex - 8) (Post-issue pattern of shareholding) so that the details could be suitably reconciled for statistical / monitoring purposes.
G. Reporting of NRI investments under PIS scheme
The link office of the designated branch of an AD Category – I bank shall furnish to the Reserve Bank18, a report on a daily basis on PIS transactions undertaken by it, on behalf of NRIs. This report can be furnished on a floppy to the Reserve Bank and also uploaded directly on the OFRS web site ( It would be the banks responsibility to ensure that the data submitted to RBI is reconciled by periodically taking a NRI holding report for their bank.
H. Reporting of foreign investment by way of issue / transfer of 'participating interest/right' in oil fields
Foreign investment by way of issue / transfer of 'participating interest/right' in oil fields by Indian companies to a non resident would be treated as an FDI transaction under the extant FDI policy and the FEMA regulations. Accordingly, transfer of 'participating interest/ rights' will be reported as 'other' category under Para 7 of revised Form FC-TRS and issuance of 'participating interest/ rights' will be reported as 'other' category of instruments under Para 4 of Form FCGPR.

Retailing in India

From Wikipedia, the free encyclopedia
Jump to: navigation, search
A textile retail store in India
A fish retail store in West Bengal, India
A food staple retail shop in Pushkar, India

Retailing in India is one of the pillars of its economy and accounts for 14 to 15 percent of its GDP.[1][2] The Indian retail market is estimated to be US$ 450 billion and one of the top five retail markets in the world by economic value. India is one of the fastest growing retail market in the world, with 1.2 billion people.[3][4]

India's retailing industry is essentially owner manned small shops. In 2010, larger format convenience stores and supermarkets accounted for about 4 percent of the industry, and these were present only in large urban centers. India's retail and logistics industry employs about 40 million Indians (3.3% of Indian population).

Until 2011, Indian central government denied foreign direct investment (FDI) in multi-brand retail, forbidding foreign groups from any ownership in supermarkets, convenience stores or any retail outlets. Even single-brand retail was limited to 51% ownership and a bureaucratic process.

In November 2011, India's central government announced retail reforms for both multi-brand stores and single-brand stores. These market reforms paved the way for retail innovation and competition with multi-brand retailers such as Walmart, Carrefour and Tesco, as well single brand majors such as IKEA, Nike, and Apple.[5] The announcement sparked intense activism, both in opposition and in support of the reforms. In December 2011, under pressure from the opposition, Indian government placed the retail reforms on hold till it reaches a consensus.[6]

In January 2012, India approved reforms for single-brand stores welcoming anyone in the world to innovate in Indian retail market with 100% ownership, but imposed the requirement that the single brand retailer source 30 percent of its goods from India. Indian government continues the hold on retail reforms for multi-brand stores.[7]

In June 2012, IKEA announced it has applied for permission to invest $1.9 billion in India and set up 25 retail stores. Fitch believes that the 30 percent requirement is likely to significantly delay if not prevent most single brand majors from Europe, USA and Japan from opening stores and creating associated jobs in India.[8][9]

On 14 September 2012, the government of India announced the opening of FDI in multi-brand retail, subject to approvals by individual states.[10] This decision has been welcomed by economists and the markets, however has caused protests and an upheaval in India's central government's political coalition structure. On 20 September 2012, the Government of India formally notified the FDI reforms for single and multi brand retail, thereby making it effective under Indian law.[11][12][13]


Local terms

Organized retailing, in India, refers to trading activities undertaken by licensed retailers, that is, those who are registered for sales tax, income tax, etc. These include the publicly traded supermarkets, corporate-backed hypermarkets and retail chains, and also the privately owned large retail businesses.

Unorganized retailing, on the other hand, refers to the traditional formats of low-cost retailing, for example, the local mom and pop store, owner manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc.[14]

Organized retailing was absent in most rural and small towns of India in 2010. Supermarkets and similar organized retail accounted for just 4% of the market.[5]


A vegetable retail market in Kerala, India on a sunny day; During monsoons, vendors experience more produce spoilage.

Most Indian shopping takes place in open markets or millions of small, independent grocery and retail shops. Shoppers typically stand outside the retail shop, ask for what they want, and can not pick or examine a product from the shelf. Access to the shelf or product storage area is limited. Once the shopper requests the food staple or household product they are looking for, the shopkeeper goes to the container or shelf or to the back of the store, brings it out and offers it for sale to the shopper. Often the shopkeeper may substitute the product, claiming that it is similar or equivalent to the product the consumer is asking for. The product typically has no price label in these small retail shops; although some products do have a manufactured suggested retail price (MSRP) pre-printed on the packaging. The shopkeeper prices the food staple and household products arbitrarily, and two consumers may pay different prices for the same product on the same day. Price is sometimes negotiated between the shopper and shopkeeper. The shoppers do not have time to examine the product label, and do not have a choice to make an informed decision between competitive products.

India's retail and logistics industry, organized and unorganized in combination, employs about 40 million Indians (3.3% of Indian population).[15] The typical Indian retail shops are very small. Over 14 million outlets operate in the country and only 4% of them being larger than 500 sq ft (46 m2) in size. India has about 11 shop outlets for every 1000 people. Vast majority of the unorganized retail shops in India employ family members, do not have the scale to procure or transport products at high volume wholesale level, have limited to no quality control or fake-versus-authentic product screening technology and have no training on safe and hygienic storage, packaging or logistics. The unorganized retail shops source their products from a chain of middlemen who mark up the product as it moves from farmer or producer to the consumer. The unorganized retail shops typically offer no after-sales support or service. Finally, most transactions at unorganized retail shops are done with cash, with all sales being final.

Until the 1990s, regulations prevented innovation and entrepreneurship in Indian retailing. Some retails faced complying with over thirty regulations such as "signboard licenses" and "anti-hoarding measures" before they could open doors. There are taxes for moving goods to states, from states, and even within states in some cases. Farmers and producers had to go through middlemen monopolies. The logistics and infrastructure was very poor, with losses exceeding 30 percent.

Through the 1990s, India introduced widespread free market reforms, including some related to retail. Between 2000 to 2010, consumers in select Indian cities have gradually begun to experience the quality, choice, convenience and benefits of organized retail industry.


An organized retail store in Ahmedabad (ca. 2009)
Customers inside a retail store in Kolkata (ca. 2011)

Growth over 1997-2010

India in 1997 allowed foreign direct investment (FDI) in cash and carry wholesale. Then, it required government approval. The approval requirement was relaxed, and automatic permission was granted in 2006. Between 2000 to 2010, Indian retail attracted about $1.8 billion in foreign direct investment, representing a very small 1.5% of total investment flow into India.[16]

Single brand retailing attracted 94 proposals between 2006 and 2010, of which 57 were approved and implemented. For a country of 1.2 billion people, this is a very small number. Some claim one of the primary restraint inhibiting better participation was that India required single brand retailers to limit their ownership in Indian outlets to 51%. China in contrast allows 100% ownership by foreign companies in both single brand and multi-brand retail presence.

Indian retail has experienced limited growth, and its spoilage of food harvest is amongst the highest in the world, because of very limited integrated cold-chain and other infrastructure. India has only 5386 stand-alone cold storages, having a total capacity of 23.6 million metric tons. However, 80 percent of this storage is used only for potatoes. The remaining infrastructure capacity is less than 1% of the annual farm output of India, and grossly inadequate during peak harvest seasons. This leads to about 30% losses in certain perishable agricultural output in India, on average, every year.[16]

Indian laws already allow foreign direct investment in cold-chain infrastructure to the extent of 100 percent. There has been no interest in foreign direct investment in cold storage infrastructure build out. Experts claim that cold storage infrastructure will become economically viable only when there is strong and contractually binding demand from organized retail. The risk of cold storing perishable food, without an assured way to move and sell it, puts the economic viability of expensive cold storage in doubt. In the absence of organized retail competition and with a ban on foreign direct investment in multi-brand retailers, foreign direct investments are unlikely to begin in cold storage and farm logistics infrastructure.

Until 2010, intermediaries and middlemen in India have dominated the value chain. Due to a number of intermediaries involved in the traditional Indian retail chain, norms are flouted and pricing lacks transparency. Small Indian farmers realize only 1/3rd of the total price paid by the final Indian consumer, as against 2/3rd by farmers in nations with a higher share of organized retail.[16] The 60%+ margins for middlemen and traditional retail shops have limited growth and prevented innovation in Indian retail industry.

India has had years of debate and discussions on the risks and prudence of allowing innovation and competition within its retail industry.[17] Numerous economists repeatedly recommended to the Government of India that legal restrictions on organized retail must be removed, and the retail industry in India must be opened to competition. For example, in an invited address to the Indian parliament in December 2010, Jagdish Bhagwati, Professor of Economics and Law at the Columbia University analysed the relationship between growth and poverty reduction, then urged the Indian parliament to extend economic reforms by freeing up of the retail sector, further liberalization of trade in all sectors, and introducing labor market reforms. Such reforms Professor Bhagwati argued will accelerate economic growth and make a sustainable difference in the life of India's poorest.,[18][19]

A 2007 report noted that an increasing number of people in India are turning to the services sector for employment due to the relative low compensation offered by the traditional agriculture and manufacturing sectors. The organized retail market is growing at 35 percent annually while growth of unorganized retail sector is pegged at 6 percent.[20]

The Retail Business in India is currently at the point of inflection. As of 2008, rapid change with investments to the tune of US $ 25 billion were being planned by several Indian and multinational companies in the next 5 years. It is a huge industry in terms of size and according to India Brand Equity Foundation (IBEF), it is valued at about US$ 395.96 billion. Organised retail is expected to garner about 16-18 percent of the total retail market (US $ 65-75 billion) in the next 5 years.

India has topped the A.T. Kearney's annual Global Retail Development Index (GRDI) for the third consecutive year, maintaining its position as the most attractive market for retail investment. The Indian economy has registered a growth of 8% for 2007. The predictions for 2008 is 7.9%.[21] The enormous growth of the retail industry has created a huge demand for real estate. Property developers are creating retail real estate at an aggressive pace and by 2010, 300 malls are estimated to be operational in the country.[22]

Growth after 2011

Before 2011, India had prevented innovation and organized competition in its consumer retail industry. Several studies claim that the lack of infrastructure and competitive retail industry is a key cause of India's persistently high inflation. Furthermore, because of unorganized retail, in a nation where malnutrition remains a serious problem, food waste is rife. Well over 30% of food staples and perishable goods produced in India spoils because poor infrastructure and small retail outlets prevent hygienic storage and movement of the goods from the farmer to the consumer.,,[23][24][25]

One report estimates the 2011 Indian retail market as generating sales of about $470 billion a year, of which a miniscule $27 billion comes from organized retail such as supermarkets, chain stores with centralized operations and shops in malls. The opening of retail industry to free market competition, some claim will enable rapid growth in retail sector of Indian economy. Others believe the growth of Indian retail industry will take time, with organized retail possibly needing a decade to grow to a 25% share.[25] A 25% market share, given the expected growth of Indian retail industry through 2021, is estimated to be over $250 billion a year: a revenue equal to the 2009 revenue share from Japan for the world's 250 largest retailers.,[26][27]

The Economist forecasts that Indian retail will nearly double in economic value, expanding by about $400 billion by 2020.[28] The projected increase alone is equivalent to the current retail market size of France.

In 2011, food accounted for 70% of Indian retail, but was under-represented by organized retail. A.T. Kearney estimates India's organized retail had a 31% share in clothing and apparel, while the home supplies retail was growing between 20% to 30% per year.[29] These data correspond to retail prospects prior to November announcement of the retail reform. The Indian market offers endless possibilities for investors.[30]

It might be true that India has the largest number of shops per inhabitant. However we (locatus) have detailed figures for Belgium, the Netherlands and Luxemburg. In Belgium, the number of outlets is approximately 8 per 1,000 and in the Netherlands it is 6. So the Indian number must be far higher.

The Indian Retail Market

Indian market has high complexities in terms of a wide geographic spread and distinct consumer preferences varying by each region necessitating a need for localization even within the geographic zones. India has highest number of outlets per person (7 per thousand) Indian retail space per capita at 2 sq ft (0.19 m2)/ person is lowest in the world Indian retail density of 6 percent is highest in the world.[31] 1.8 million households in India have an annual income of over INR45 lakh (US$81,900).[32]

While India presents a large market opportunity given the number and increasing purchasing power of consumers, there are significant challenges as well given that over 90% of trade is conducted through independent local stores. Challenges include: Geographically dispersed population, small ticket sizes, complex distribution network, little use of IT systems, limitations of mass media and existence of counterfeit goods.[33]

Major Indian Retailers

[dated info]

Checkout lanes, organized retail in Malad, Mumbai

Indian apparel retailers are increasing their brand presence overseas, particularly in developed markets. While most have identified a gap in countries in West Asia and Africa, some majors are also looking at the US and Europe. Arvind Brands, Madura Garments, Spykar Lifestyle and Royal Classic Polo are busy chalking out foreign expansion plans through the distribution route and standalone stores as well. Another denim wear brand, Spykar, which is now moving towards becoming a casualwear lifestyle brand, has launched its store in Melbourne recently. It plans to open three stores in London by 2008-end.[34]

The low-intensity entry of the diversified Mahindra Group into retail is unique because it plans to focus on lifestyle products. The Mahindra Group is the fourth largest Indian business group to enter the business of retail after Reliance Industries Ltd, the Aditya Birla Group, and Bharti Enterprises Ltd. The other three groups are focusing either on perishables and groceries, or a range of products, or both.

  • REI AGRO LTD Retail: 6TEN and 6TEN kirana stores
  • Future Groups-Formats: Big Bazaar, Food Bazaar, Central, Fashion Station, Brand Factory, Home Town, E-Zone etc.
  • Raymond Ltd.: Textiles, The Raymond Shop, Park Avenue, Park Avenue Woman, Parx, Colourplus, Neck Ties & More, Shirts & More etc.
  • Fabindia: Textiles, Home furnishings, handloom apparel, jewellery
  • RP-Sanjiv Goenka Group Retail-Formats: Spencer's Hyper, Spencer's Daily, Music World, Au Bon Pain, Beverly Hills Polo Club
  • The Tata Group-Formats: Westside, Star India Bazaar, Steeljunction, Landmark, Titan,Tanishq, Croma.
  • Reliance Retail-Formats: Reliance MART, Reliance SUPER, Reliance FRESH, Reliance Footprint, Reliance Living, Reliance Digital, Reliance Jewellery, Reliance Trends, Reliance Autozone, iStore
  • K Raheja Corp Group-Formats: Shoppers Stop, Crossword, Hyper City, Inorbit Mall
  • Nilgiri's-Formats: Nilgiris' supermarket chain
  • Shri Kannan Departmental Store (P) Ltd ., : Groceries, Clothing, Cosmetics [Western Tamilnadu's Leading Retailer]
  • Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International Franchise brand stores.
  • Pyramid Retail-Formats: Pyramid Megastore, TruMart
  • Next retail India Ltd (Consumer Electronics)(
  • Vivek Limited Retail Formats: Viveks, Jainsons, Viveks Service Centre, Viveks Safe Deposit Lockers
  • PGC Retail -T-Mart India [1], Switcher, Respect India, Grand India Bazaar,etc.,
  • Aditya Birla Group- Formats: more., acquiured Pantaloon from Future group, acquired Trinetra (Fabmall and Fabcity)
  • Vishal Retail Group-Formats: Vishal Mega Mart
  • BPCL-Formats: In & Out
  • Shoprite Holdings-Formats: Shoprite Hyper
  • Paritala stores bazar: honey shine stores
  • Kapas- Cotton garment outlets
  • AaramShop - a platform which enables hybrid commerce for thousands of neighborhood stores.
  • Nmart Retails with 131 operating Stores till now and total 287 Stores in India and 1 to open in DUBAI Shortly and many more in Process Globally (ZAMBIA, BANGLADESH, SRI LANKA etc.). (Expected to be 500 by the end of 2012)(
  • Gitanjali- Nakshatra, Gili, Asmi, D'damas, Gitanjali Jewels, Giantti, Gitanjali Gifts, etc.
Entry of MNCs
A spice market

The world's largest retailer by sales, Wal-Mart Stores Inc and Sunil Mittal's Bharti Enterprises have entered into a joint venture agreement and they are planning to open 10 to 15 cash-and-carry facilities over seven years. The first of the stores, which will sell groceries, consumer appliances and fruits and vegetables to retailers and small businesses, is slated to open in north India by the end of 2008.[35] see also for more Detail Pick/Müller "[2]"</ref>

Carrefour, the world's second largest retailer by sales, is planning to set up two business entities in the country one for its cash-and-carry business and the other a master franchisee which will lend its banner, technical services and know how to an Indian company for direct-to-consumer retail.[36]

The world's fifth largest retailer by sales, Costco Wholesale Corp (Costco) known for its warehouse club model is also interested in coming to India and waiting for the right opportunity.[37]

Tesco Plc., plans to set up shop in India with a wholesale cash-and-carry business and will help Indian conglomerate Tata group to grow its hypermarket business.


A McKinsey study claims retail productivity in India is very low compared to international peer measures. For example, the labor productivity in Indian retail was just 6% of the labor productivity in United States in 2010. India's labor productivity in food retailing is about 5% compared to Brazil's 14%; while India's labor productivity in non-food retailing is about 8% compared to Poland's 25%.[38]

Total retail employment in India, both organized and unorganized, account for about 6% of Indian labor work force currently - most of which is unorganized. This about a third of levels in United States and Europe; and about half of levels in other emerging economies. A complete expansion of retail sector to levels and productivity similar to other emerging economies and developed economies such as the United States would create over 50 million jobs in India. Training and development of labor and management for higher retail productivity is expected to be a challenge.

To become a truly flourishing industry, retailing in India needs to cross the following hurdles:[39]

  • Automatic approval is not allowed for foreign investment in retail.
  • Regulations restricting real estate purchases, and cumbersome local laws.
  • Taxation, which favours small retail businesses.
  • Absence of developed supply chain and integrated IT management.
  • Lack of trained work force.
  • Low skill level for retailing management.
  • Lack of Retailing Courses and study options
  • Intrinsic complexity of retailing – rapid price changes, constant threat of product obsolescence and low margins.

In November 2011, the Indian government announced relaxation of some rules and the opening of retail market to competition.

India retail reforms

Until 2011, Indian central government denied foreign direct investment (FDI) in multi-brand Indian retail, forbidding foreign groups from any ownership in supermarkets, convenience stores or any retail outlets, to sell multiple products from different brands directly to Indian consumers..

The government of Manmohan Singh, prime minister, announced on 24 November 2011 the following:[23][40]

  • India will allow foreign groups to own up to 51 per cent in "multi-brand retailers", as supermarkets are known in India, in the most radical pro-liberalisation reform passed by an Indian cabinet in years;
  • single brand retailers, such as Apple and Ikea, can own 100 percent of their Indian stores, up from the previous cap of 51 percent;
  • both multi-brand and single brand stores in India will have to source nearly a third of their goods from small and medium-sized Indian suppliers;
  • all multi-brand and single brand stores in India must confine their operations to 53-odd cities with a population over one million, out of some 7935 towns and cities in India. It is expected that these stores will now have full access to over 200 million urban consumers in India;
  • multi-brand retailers must have a minimum investment of US$100 million with at least half of the amount invested in back end infrastructure, including cold chains, refrigeration, transportation, packing, sorting and processing to considerably reduce the post harvest losses and bring remunerative prices to farmers;
  • the opening of retail competition will be within India's federal structure of government. In other words, the policy is an enabling legal framework for India. The states of India have the prerogative to accept it and implement it, or they can decide to not implement it if they so choose. Actual implementation of policy will be within the parameters of state laws and regulations.

The opening of retail industry to global competition is expected to spur a retail rush to India. It has the potential to transform not only the retailing landscape but also the nation's ailing infrastructure.,[23][41]

A Wall Street Journal article claims that fresh investments in Indian organized retail will generate 10 million new jobs between 2012–2014, and about five to six million of them in logistics alone; even though the retail market is being opened to just 53 cities out of about 8000 towns and cities in India.[41]

It is expected to help tame stubbornly high inflation but is likely to be vehemently opposed by millions of small retailers, who see large foreign chains as a threat. The need to control food price inflation—averaging double-digit rises over several years—prompted the government to open the sector, analysts claim. Hitherto India's food supplies have been controlled by tens of millions of middlemen (less than 5% of Indian population). Traders add huge mark-ups to farm prices, while offering little by way of technical support to help farmers boost their productivity, packaging technology, pushing up retail prices significantly. Analysts said allowing in big foreign retailers would provide an impetus for them to set up modern supply chains, with refrigerated vans, cold storage and more efficient logistics. "I think foreign chains can also bring in humongous logistical benefits and capital," Chandrajit Banerjee, director-general, Confederation of Indian Industry, told Reuters. "The biggest beneficiary would be the small farmers who will be able to improve their productivity by selling directly to large organised players," Mr Banerjee said.

Indian retail reforms on hold

According to Bloomberg, on 3 December 2011, the Chief Minister of the Indian state of West Bengal, Mamata Banerjee, who is against the policy and whose Trinamool Congress brings 19 votes to the ruling Congress party-led coalition, claimed that India's government may put the FDI retail reforms on hold until it reaches consensus within the ruling coalition. Reuters reports that this risked a possible dilution of the policy rather than a change of heart.,,[42][43][44]

India Today claimed that the resistance to Indian retail reforms is primarily because it has been badly sold, even though it can help fix the exploitation of Indian farmers by the decades-old "arhtiya" and "mandi" monopoly system. India Today claims the policy is good for the small Indian farmer and the Indian consumer.[45]

Pratap Mehta, president of the Centre for Policy Research, claimed any U-turn or postponement of retail reforms will cause an immense loss of face to the Congress-led central government of Manmohan Singh. The mom-and-pop farmers of India support these reforms. The consumers of India want the reforms. The government has already annoyed those who oppose change and innovation in retail. By putting retail reforms on hold, the government will additionally alienate much larger segment of India's population supporting FDI. So they will now have the worst of both worlds, claims Mehta.[46]

Deepak Parekh, Ashok Ganguly and other economic policy leaders of India, on 4 December 2011, called placing investment and innovation in retail on hold for the sake of vested interests as unfair and detrimental to vast majority in India. They urged farmers, consumers and the common people to raise their voice against this false drama of apprehension against investment and modernising trade in organised retailing. They called upon Indians to come out and strongly support progressive measures and reforms with the same spirit and gusto with which we take the liberties to criticize policies or issues we do not appreciate.[47]

Several newspapers claimed on 6 December 2011 that India parliament is expected to shelve retail reforms while the ruling Congress party seeks consensus from the opposition and the Congress party's own coalition partners. Suspension of retail reforms on 7 December 2011 would be, the reports claimed, an embarrassing defeat for the Indian government, suggesting it is weak and ineffective in implementing its ideas.[48]

Anand Sharma, India's Commerce and Industry Minister, after a meeting of all political parties on 7 December 2011 said, "The decision to allow foreign direct investment in retail is suspended till consensus is reached with all stakeholders."[6]

Single-brand retail reforms approved

On January 11, 2012, India approved increased competition and innovation in single-brand retail.[49]

The reform seeks to attract investments in production and marketing, improve the availability of goods for the consumer, encourage increased sourcing of goods from India, and enhance competitiveness of Indian enterprises through access to global designs, technologies and management practices. In this announcement, India requires single-brand retailer, with greater than 51% foreign ownership, to source at least 30% of the value of products from Indian small industries, village and cottage industries, artisans and craftsmen.

Mikael Ohlsson, chief executive of IKEA, announced IKEA is postponing its plan to open stores in India. He claimed that IKEA's decision reflects India's requirements that single-brand retailers such as IKEA source 30 percent of their goods from local small and medium-sized companies. This was an obstacle to IKEA's investment in India, and that it will take IKEA some time to source goods and develop reliable supply chains inside India. Ikea announced that it plans to double what it sources from India already for its global product range, to over $1 billion a year, within three years. IKEA in the near term, plans to focus expansion instead in China and Russia, where such restrictions do not exist.[9]

Social impact and controversy with retail reforms

The November 2011 retail reforms in India have sparked intense activism, both in opposition and in support of the reforms.

Controversy over Indian retail reforms

A horticultural produce retail market in Kolkata, India; produce loss in these retail formats is very high for perishables

Critics of the Indian retail reforms announcement are making one or more of the following points:,[50][51]

  • Independent stores will close, leading to massive job losses. Walmart employs very few people in the United States. If allowed to expand in India as much as Walmart has expanded in the United States, few thousand jobs may be created but millions will be lost.
  • Walmart's efficiency at supply chain management leads to "direct" procurement of goods from the supplier. In addition to eliminating the "middle-man", due to its status as the leading retailer, suppliers of goods also bend over backwards to drop prices in order

to assure consistent cash flow. There is the fear that this may not benefit the farmer, or the suppliers of Walmart.

  • The small retailer and the middle man present in the retail industry plays a large part in supporting the local economy, since they typically themselves procure goods and services from the area they have their retail shops in. This leads to increased economic activity, and wealth redistribution. With large, efficient retailers, the corporate profits are not spent in the areas where they're generated, hence killing the local economy.
  • Walmart will lower prices to dump goods, get competition out of the way, become a monopoly, then raise prices. We have seen this in the case of the soft drinks industry. Pepsi and Coke came in and wiped out all the domestic brands.
  • India doesn't need foreign retailers, since homegrown companies and traditional markets may be able to do the job.
  • Work will be done by Indians, profits will go to foreigners.
  • Remember East India Company. It entered India as a trader and then took over politically.
  • There will be sterile homogeneity and Indian cities will look like cities anywhere else.
  • The government hasn't built consensus.

Supporters claim none of these objections has merit. They claim:[51]

  • Organized retail will need workers. Walmart employs 1.4 million people in United States alone.[52] With United States population of about 300 million, and India's population of about 1200 million, if Walmart-like retail companies were to expand in India as much as their presence in the United States, and the staffing level in Indian stores kept at the same level as in the United States stores, Walmart alone would employ 5.6 million Indian citizens. Walmart has a 6.5% market share of the total United States retail. Adjusted for this market share, the expected jobs in future Indian organized retail would total over 85 million. In addition, millions of additional jobs will be created during the building of and the maintenance of retail stores, roads, cold storage centers, software industry, electronic cash registers and other retail supporting organizations. Instead of job losses, retail reforms are likely to be massive boost to Indian job availability.
  • KPMG - one of the world's largest audit companies - finds that in China, the employment in both retail and wholesale trade increased from 4% in 1992 to about 7% in 2001, post China opening its retail to foreign and domestic innovation and competition. In absolute terms, China experienced the creation of 26 million new jobs within 9 years, post China announcing FDI retail reforms. Additionally, contrary to some concerns in China, post retail reforms, the number of traditional small retailers also grew by 30% over 5 years.[16]
  • India needs trillions of dollar to build its infrastructure, hospitals, housing and schools for its growing population. Indian economy is small, with limited surplus capital. Indian government is already operating on budget deficits. It is simply not possible for Indian investors or Indian government to fund this expansion, job creation and growth at the rate India needs. Global investment capital through FDI is necessary. Beyond capital, Indian retail industry needs knowledge and global integration. Global retail leaders, some of which are partly owned by people of Indian origin,[53] can bring this knowledge. Global integration can potentially open export markets for Indian farmers and producers. Walmart, for example, expects to source and export some $1 billion worth of goods from India every year, since it came into Indian wholesale retail market.[54]
  • Walmart, Carrefour, Tesco, Target, Metro, Coop are some of over 350 global retail companies with annual sales over $1 billion. These retail companies have operated for over 30 years in numerous countries. They have not become monopolies. Competition between Walmart-like retailers has kept food prices in check. Canada credits their very low inflation rates to Walmart-effect.[55] Anti-trust laws and state regulations, such as those in Indian legal code, have prevented food monopolies from forming anywhere in the world. Price inflation in these countries has been 5 to 10 times lower than price inflation in India. The current consumer price inflation in Europe and the United States is less than 2%, compared to India's double digit inflation.
  • The Pepsi and Coke example is meaningless in the context of Indian beverage market. More competition is lacking because of limited demand. Indian consumer has limited interest in soft drinks. Soft drinks represent less than 5% of Indian beverage market.[56] Indian consumer prefers milk-based, tea and coffee and these account for 90% of Indian beverage market. In these markets, Coca Cola and Pepsi have plenty of competition. The next most important market in India is bottled water, that outsells combined soft drink sales of the Pepsi and Coca Cola. Bottled water, milk, coffee and tea market in India are big markets, and have plenty of domestic brands, European brands like Nestle, as well as Pepsi and Coca Cola. Organized retail too will have numerous brands and strong competition.
  • Comparing 21st century to 18th century is inappropriate. Conditions today are not same as in the 18th century. India wasn't a democracy then, it is today. Global awareness and news media were not the same in 18th century as today. Consider China today. It has over 57 million square feet of retail space owned by foreigners, employing millions of Chinese citizens. Yet, China hasn't become a vassal of imperialists. It enjoys respect from all global powers. Other Asian countries like Malaysia, Taiwan, Thailand and Indonesia see foreign retailers as catalysts of new technology and price reduction; and they have benefitted immensely by welcoming FDI in retail. India too will benefit by integrating with the world, rather than isolating itself.[57]
  • With 51% FDI limit in multi-brand retailers, nearly half of any profits will remain in India. Any profits will be subject to taxes, and such taxes will reduce Indian government budget deficit. Many years ago, China adopted the retail reform policy India has announced; China allowed FDI in its retail sector. It has taken FDI-financed retailers in China between 5 to 10 years to post profits, in large part because of huge investments they had to make initially. Like China, it is unlikely foreign retailers will earn any profits in India for the first 5 to 10 years.[28] Ultimately, retail companies must earn profits with hard work and by creating value.
  • States have a right to say no to retail FDI within their jurisdiction.[40] States have the right to add restrictions to the retail policy announced before they implement them. Thus, they can place limits on number, market share, style, diversity, homogeneity and other factors to suit their cultural preferences. Finally, in future, states can always introduce regulations and India can change the law to ensure the benefits of retail reforms reach the poorest and weakest segments of Indian society, free and fair retail competition does indeed lead to sharply lower inflation than current levels, small farmers get better prices, jobs created by organized retail pay well, and healthier food becomes available to more households.
  • Inbuilt inefficiencies and wastage in distribution and storage account for why, according to some estimates, as much as 40% of food production doesn't reach consumers. Fifty million children in India are malnourished.[51] Food often rots at farms, in transit, or in antiquated state-run warehouses. Cost-conscious organized retail companies will avoid waste and loss, making food available to the weakest and poorest segment of Indian society, while increasing the income of small farmers. Walmart, for example, since its arrival in Indian wholesale retail market, has successfully introduced "Direct Farm Project" at Haider Nagar near Malerkotla in Punjab, where 110 farmers have been connected with Bharti Walmart for sourcing fresh vegetables directly, thereby reducing waste and bringing fresher produce to Indian consumers.[54]
  • Indian small shops employ workers without proper contracts, making them work long hours. Many unorganized small shops depend on child labour. A well-regulated retail sector will help curtail some of these abuses.[51]
  • Organized retail has enabled a wide range of companies to start and flourish in other countries. For example, in the United States, an organized retailer named Whole Foods has rapidly grown to annual revenues of $9 billion by working closely with farmers, delighting customers and caring about the communities it has stores in.[58]
  • The claims that there is no consensus is without merit. About 10 years ago, when opposition formed the central government, they had proposed retail reforms and suggested India consider FDI in retail. Retail reforms discussions are not new. More recently, retail reforms announced evolved after a process of intense consultations and consensus building intiative. In 2010, the Indian government circulated a discussion paper on FDI retail reforms.[16] On July 6, 2011, another version of the discussion paper was circulated by the central government of India.[59] Comments from a wide cross-section of Indian society including farmers' associations, industry bodies, consumer forums, academics, traders' associations, investors, economists were analyzed in depth before the matter was discussed by the Committee of Secretaries. By early August 2011, the consensus from various segments of Indian society was overwhelming in favor of retail reforms.[60] The reform outline was presented in India's Rajya Sabha in August 2011. The announced reforms are the result of this consensus process. The current opposition is not helping the consensus process, since consensus is not built by threats and disruption. Those who oppose current retail reforms should help build consensus with ideas and proposals, if they have any. The opposition parties currently disrupting the Indian parliament on retail reforms have not offered even one idea or a single proposal on how India can eliminate food spoilage, reduce inflation, improve food security, feed the poor, improve the incomes of small farmers.

Walmart effect' on Mexico shows the true price of bargains

August 2, 2011 at 05:00am

Bloomberg News Customers exit a Wal-Mart store in Mexico City, Mexico on Thursday, March 30, 2006. Photographer: Jaime Puebla / Bloomberg News In 2004 the Mexican Federal Competition Commission took the extraordinary step of allowing collusion in the Mexican retail market when it approved the establishment of Sinergia, a buying co-operative comprising Mexico's second-, third- and fourth-largest retailers.

Why would a regulator that serves to defend competition endorse anti-competitive behaviour? Simple: Walmart. For Walmart is the undisputed leader in the Mexican retail sector and the commission was trying to correct massive distortions of power between Walmart and its competitors, particularly around pricing.

As the New York Times noted at the time, "the joint purchasing company (Sinergia) is an attempt to match Walmart's influence over suppliers".

During South Africa's Competition Tribunal hearings into the Walmart-Massmart merger, Walmart dismissed concerns about the company's effect on local competition and employment by referring to its alleged effect in Chile, where it has been operating since 2009. However, fundamental flaws were identified with the Chilean example. We believe a much better indicator of the likely medium- to long-term effect of the company on South Africa can be found with Walmart's experiences in Mexico.

Walmart entered Mexico in 1991 when it purchased a local retailer, Cifra. For the first few years of its presence, Walmex – as the company is known in Mexico – grew slowly. However, since 2005 when the company had only 488 stores, Walmex has seen spectacular growth, reaching a total of 1 364 stores by December 2010. In comparison its nearest competitor, Soriana, had just 508 stores, and a further 300 convenience stores – many of which are franchises.

Even with the buying co-operative, Walmex's competitors cannot keep up. Walmart's financial and buying power are simply too great. The company has invested the equivalent of R8 billion in its Mexican operations in 2011 alone, a trifling amount for a colossus like Walmart – whose sales in 2010 were more than R2.8 trillion. This is difficult for Soriana to match, with sales of only R55bn in 2010 (and would be similarly difficult for South African retailers, whose market leader, Shoprite, had sales of R67bn in 2010). Walmart's unparalleled financial clout means it is peerless in its power to invest in its operations and grow vis-à-vis its competitors.

What of the effect of Walmart's pursuit of its low-price strategy? French economist Cedric Durand has linked Walmex to a dramatic increase in imported goods into Mexico in an article published in the Cambridge Journal of Economics:

"After 1997, we observe a faster increase in Walmart's imports in real terms compared with its competitors'. If we look at the imports-to-purchases ratio, we see that all the enterprises have been significantly increasing the share of imports in their purchases, but also that Walmart has shown a much more dramatic evolution: from 20 percent in 1997 to more than 55 percent in 2002 and 2003."

Walmart's pursuit of low prices significantly affected the total levels of imports into Mexico. In this, Durand's findings echo similar conclusions by the Economic Policy Institute (EPI), which analysed Walmart's effects on imports and jobs in the US. It concluded that Walmart's imports alone were responsible for destroying 200 000 jobs – including 130 000 manufacturing jobs – between 2001 and 2006. The destruction of manufacturing jobs is significant: a strong manufacturing industry is a key driver of development.

That Walmart's massive bargaining power and its importation practices lead to increased job losses is borne out by the Mexican evidence. For instance, Walmart expert and professor at the University of California, Nelson Lichtenstein, has said: "Walmex has had a devastating impact on Mexican manufacturing. Although Wal-mart initially claimed that it would incorporate local Mexican firms into its supply chain, the famous squeeze on profits and labour never let up."

He quoted an executive of a small clothing manufacturer as saying: "Walmart has driven many suppliers out of business. Walmart maintains its profit margins… They never reduce their margin. They do pass on savings in price, but at the expense of the manufacturer. You can increase efficiency a certain amount, but… for example, they may tell you, 'We're going to sell shirts at a 40 percent discount – you, the manufacturer have to cut your price 40 percent.' So the consumer benefits, but they're driving out of business the manufacturers that provide jobs."

Even when Walmex purchases goods locally, it squeezes manufacturers to continuously reduce costs. This usually ends in manufacturers having to import the goods they supply, as they cannot manufacture at such low prices, legally anyhow.

Clothing makers and workers have not been the only casualties of Walmex. Many other sectors have been affected. For instance, while productivity has increased within the soaps, detergents and surfactants industry in Mexico, employment in that industry has decreased by about 20 percent, largely as a result of Walmart.

So, what does Mexico have to teach South Africa about Walmart?

First, the financial power of Walmart is likely to benefit Massmart in South Africa, with significant effects on competition. Massmart will be leveraged into a position of market dominance (both within and beyond the liquor, building material and general merchandise markets where it currently leads) by virtue of Walmart's unmatched financial power. Concentration and consolidation of the retail industry will occur and barriers to entry for new and smaller competitors will rise.

Second, Walmart is likely to increase the scale of problems facing South Africa, including job losses, unemployment and deindustrialisation. As Durand has shown for Mexico, competitor retailers will mimic Walmart's practices (the Walmart effect) to better compete with the company. Greater imports will occur as competitors seek the cheapest prices.

In instances where local procurement initially occurs, Walmart and its South African competitors will squeeze local manufacturers even further than they already are squeezed causing many local companies to restructure or fold. Jobs will be lost (both among local manufacturers and among retailers who will struggle to match Walmart's prices and their growth), offsetting any jobs that Walmart creates.

The possibility of lower prices from Walmart may be attractive, but at what cost? Low prices cannot come at the expense of local manufacturing and retail jobs and increased concentration in the retail sector, among others.

Mexico's experience of Walmart shows that the company poses real challenges to South Africa, particularly in key socio-economic matters. We should tread with great, great care.

Etienne Vlok and Simon Eppel work for the SA Labour Research Institute, the research arm of the Southern African Clothing and Textile Workers Union.

Opposition to retail reforms

Within a week of retail reform announcement, Indian government has faced a political backlash against its decision to allow competition and 51% ownership of multi-brand organized retail in India.

Despite the fact that Salman Khurshid, India's law minister, claiming that many opposition parties, including the Bharatiya Janata Party, had privately encouraged the government to push through the retail reform, the intense criticism now targets Congress-led coalition government, and its decision to push through one of the biggest economic reforms in years for India. Opposition parties claim supermarket chains are ill-advised, unilateral and unwelcome.[61]

The opposition claims the entry of organized retailers would lead to their dominance that would decimate local retailers and force millions of people out of work.

Mamata Banerjee, the chief minister of West Bengal and the leader of the Trinamool Congress, announced her opposition to retail reform, claiming "Some people might support it, but I do not support it. You see America is America … and India is India. One has to see what one's capacity is."[62]

Other states whose Chief Ministers have either personally announced opposition or announced reluctance to implement the retail reforms: Tamil Nadu, Uttar Pradesh, Bihar and Madhya Pradesh.

Chief Ministers of many states have not made a personal statement in opposition or support of India needing retail reforms. Gujarat, Kerala, Karnataka and Rajasthan are examples of these states. Both sides have made conflicting claims about the position of chief ministers from these states.

A Wall Street Journal article reports that in Uttar Pradesh, Uma Bharti, a senior leader of the opposition Bharatiya Janata Party (BJP), threatened to "set fire to the first Wal-Mart store whenever it opens;" with her colleague Sushma Swaraj busy tweeting up a storm of misinformation about how Wal-Mart allegedly ruined the U.S. economy.[63]

On 1 December 2011, an India-wide "bandh" (close all business in protest) was called by political parties opposing the retail reform. While many organizations responded, the reach of the protest was mixed.[64] The Times of India, a national newspaper of India, claimed people appeared divided over the bandh call and internal rivalry among trade associations led to a mixed response, leaving many stores open day-long and others opening for business as usual in the second half of the day. Even Purti Group, a network of stores owned and operated by Nitin Gadkari were open for business, ignoring the call for bandh. Gadkari is the president of BJP, the key party currently organizing opposition to retail reform.[65]

The Hindu, another widely circulated newspaper in India, claimed the opposition's call for a nation wide shutdown on 1 December 2011, in protest of retail reform received a mixed response. Some states had strong support, while most did not. Even in states where opposition political parties are in power, many ignored the call for the shutdown. In Gujarat, Bihar, Delhi, Andhra Pradesh, Haryana, Punjab and Assam the call evoked a partial response. While a number of wholesale markets observed the shutdown, the newspaper claimed a majority of kirana stores and neighborhood small shops — for whom apparently the trade bandh had been called — remained open, ignoring the shutdown call. Conflicting claims were made by the organizers of the nation wide shutdown. Contrary to eyewitness reports, one Trader union's secretary general claimed traders across the country participated wholeheartedly in the strike.[66]

The political parties opposing the retail reforms physically disrupted and forced India's parliament to adjourn again on Friday 2 December 2011. The Indian government refused to cave in, in its attempt to convince through dialogue that retail reforms are necessary to protect the farmers and consumers. Indian parliament has been dysfunctional for the entire week of November 28, 2011 over the opposition to retail reforms.[67]

Support for retail reforms

In a pan-Indian survey conducted over the weekend of 3 December 2011, overwhelming majority of consumers and farmers in and around ten major cities across the country support the retail reforms. Over 90 per cent of consumers said FDI in retail will bring down prices and offer a wider choice of goods. Nearly 78 per cent of farmers said they will get better prices for their produce from multi-format stores. Over 75 per cent of the traders claimed their marketing resources will continue to be needed to push sales through multiple channels, but they may have to accept lower margins for greater volumes.[68]

Farmer groups

Various farmer associations in India have announced their support for the retail reforms. For example:

  • Shriram Gadhve of All India Vegetable Growers Association (AIVGA) claims his organization supports retail reform. He claimed that currently, it is the middlemen commission agents who benefit at the cost of farmers. He urged that the retail reform must focus on rural areas and that farmers receive benefits. Gadhve claimed, "A better cold storage would help since this could help prevent the existing loss of 34% of fruits and vegetables due to inefficient systems in place." AIVGA operates in nine states including Maharashtra, Andhra Pradesh, West Bengal, Bihar, Chattisgarh, Punjab and Haryana with 2,200 farmer outfits as its members.[69]
  • Bharat Krishak Samaj, a farmer association with more than 75,000 members says it supports retail reform. Ajay Vir Jakhar, the chairman of Bharat Krishak Samaj, claimed a monopoly exists between the private guilds of middlemen, commission agents at the sabzi mandis (India's wholesale markets for vegetables and farm produce) and the small shopkeepers in the unorganized retail market. Given the perishable nature of food like fruit and vegetables, without the option of safe and reliable cold storage, the farmer is compelled to sell his crop at whatever price he can get. He cannot wait for a better price and is thus exploited by the current monopoly of middlemen. Jakhar asked that the government make it mandatory for organized retailers to buy 75% of their produce directly from farmers, bypassing the middlemen monopoly and India's sabzi mandi auction system.[69]
  • Consortium of Indian Farmers Associations (CIFA) announced its support for retail reform. Chengal Reddy, secretary general of CIFA claimed retail reform could do lots for Indian farmers. Reddy commented, "India has 600 million farmers, 1,200 million consumers and 5 million traders. I fail to understand why political parties are taking an anti-farmer stand and worried about half a million brokers and small shopkeepers." CIFA mainly operates in Andhra Pradesh, Karnataka and Tamil Nadu; but has a growing members from rest of India, including Shetkari Sanghatana in Maharashtra, Rajasthan Kisan Union and Himachal Farmer Organisations.
  • Prakash Thakur, the chairman of the People for Environment Horticulture & Livelihood of Himachal Pradesh, announcing his support for retail reforms claimed FDI is expected to roll out produce storage centers that will increase market access, reduce the number of middlemen and enhance returns to farmers.[70] Highly perishable fruits like cherry, apricot, peaches and plums have a huge demand but are unable to tap the market fully because of lack of cold storage and transport infrastructure. Sales will boost with the opening up of retail. Even though India is the second-largest producer of fruits and vegetables in the world, its storage infrastructure is grossly inadequate, claimed Thakur.
  • Sharad Joshi, founder of Shetkari Sangathana (farmers association), has announced his support for retail reforms.[71] Joshi claims FDI will help the farm sector improve critical infrastructure and integrate farmer-consumer relationship. Today, the existing retail has not been able to supply fresh vegetables to the consumers because they have not invested in the backward integration. When the farmers' produce reaches the end consumer directly, the farmers will naturally be benefited. Joshi feels retail reform is just a first step of needed agricultural reforms in India, and that the government should pursue additional reforms.

Suryamurthy, in an article in The Telegraph, claims farmer groups across India do not support status quo and seek retail reforms, because with the current retail system the farmer is being exploited. For example, the article claims:[70]

  • Indian farmers get only one third of the price consumers pay for food staples, the rest is taken as commissions and markups by middlemen and shopkeepers
  • For perishable horticulture produce, average price farmers receive is barely 12 to 15% of the final price consumer pays
  • Indian potato farmers sell their crop for Rs. 2 to 3 a kilogram, while the Indian consumer buys the same potato for Rs. 12 to 20 a kilogram.[72]

Economists and entrepreneurs

Many business groups in India are welcoming the transformation of a long-protected sector that has left Indian shoppers bereft of the scale and variety of their counterparts in more developed markets.[61]

B. Muthuraman, the president of the Confederation of Indian Industry, claimed the retail reform would open enormous opportunities and lead to much-needed investment in cold chain, warehousing and contract farming.

Organized retailers will reduce waste by improving logistics, creating cold storage to prevent food spoilage, improve hygiene and product safety, reduce counterfeit trade and tax evasion on expensive item purchases, and create dependable supply chains for secure supply of food staples, fruits and vegetables. They will increase choice and reduce India's rampant inflation by reducing waste, spoilage and cutting out middlemen. Fresh investment in organized retail, the supporters of retail reform claim will generate 10 million new jobs by 2014, about five to six million of them in logistics alone.[63]

Organized retail will offer the small Indian farmer more competing venues to sell his or her products, and increase income from less spoilage and waste. A Food and Agricultural Organization report claims that currently, in India, the small farmer faces significant losses post-harvest at the farm and because of poor roads, inadequate storage technologies, inefficient supply chains and farmer's inability to bring the produce into retail markets dominated by small shopkeepers. These experts claim India's post-harvest losses to exceed 25%, on average, every year for each farmer.,[73][74]

Unlike the current monopoly of middlemen buyer, retail reforms offer farmers access to more buyers from organized retail. More buyers will compete for farmers produce leading to better support for farmers and to better bids. With less spoilage of staples and agricultural produce, global retail companies can find and provide additional markets to Indian farmers. Walmart, since its arrival in India's wholesale retail market, already sources and exports about $1 billion worth of Indian goods for its global customers.

Not only do these losses reduce food security in India, the study claims that poor farmers and others loose income because of the waste and inefficient retail. Over US$50 billion of additional income can become available to Indian farmers by preventing post-harvest farm losses, improving transport, proper storage and retail. Organized retail is also expected to initiate infrastructure development creating millions of rural and urban jobs for India's growing population. One study claims that if these post-harvest food staple losses could be eliminated with better infrastructure and retail network in India, enough food would be saved every year to feed 70 to 100 million people over the year.[75]

Supporters of retail reform, The Economist claims, say it will increase competition and quality while reducing prices helping to reduce India's rampant inflation that is close to the double digits. These supporters claim that unorganized small shopkeepers will continue to exist alongside large organized supermarkets, because for many Indians they will remain the most accessible and most convenient place to shop.[76]

Amartya Sen, the Indian born Nobel prize winning economist, in a December 2011 interview claims foreign direct investment in multi brand retail can be good thing or bad thing depending on the nature of the investment. Quite often, claims Professor Sen, FDI is a good thing for India.[77]

Chief Ministers of Indian states

Supporters of retail reform who have voiced the need to promote organized retail include Chief Ministers of several states of India, several belonging to political parties that have no affiliation with Congress-led central government of India. The list includes the Chief Ministers of Maharashtra, Andhra Pradesh, Tamil Nadu and Gujarat. In a report submitted earlier in 2011, these Chief Ministers urged the Prime Minister to prioritize reforms to help promote organized retail, shorten the retail path from farm to consumer, allow organized retail to buy direct from farmers at remunerative produce prices, and reduce farm to retail costs.[78] Similarly, the Chief Minister of Delhi has come out in support of the retail reform,[79] as have the Chief Ministers of the two farming states of Haryana and Punjab in north India.,[80][81] The Chief Ministers of Haryana and Punjab claim that the announced retail reforms will immensely benefit farmers in their states.

The Chief Minister of the state of Maharashtra - the state with the highest GDP in India and home to its financial capital Mumbai - has also welcomed the retail reform.,[82][83]

Tarun Gogoi, the Chief Minister of Assam, an eastern state in India, announcing his support to the retail reform, claimed "this will go a long way in bringing about a sea change in rural economy. The decision will boost agriculture and allied sectors, manufacturing, logistics, integrated cold chains, refrigerated transportation and food processing facilities in a big way." Criticising the BJP-organized opposition, Gogoi claimed that these parties who had just a few years ago dubbed opening up retail as good for India, are now singing a different tune.[84]

Current supermarkets

Existing Indian retail firms such as Spencer's, Foodworld Supermarkets Ltd, Nilgiri's and ShopRite support retail reform and consider international competition as a blessing in disguise. They expect a flurry of joint ventures with global majors for expansion capital and opportunity to gain expertise in supply chain management. Spencer's Retail with 200 stores in India, and with retail of fresh vegetables and fruits accounting for 55 per cent of its business claims retail reform to be a win-win situation, as they already procure the farm products directly from the growers without the involvement of middlemen or traders. Spencer's claims that there is scope for it to expand its footprint in terms of store location as well as procuring farm products. Foodworld, which operates over 60 stores, plans to ramp up its presence to more than 200 locations. It has already tied up with Hong Kong-based Dairy Farm International. With the relaxation in international investments in Indian retail, India's Foodworld expects its global relationship will only get stronger. Competition and investment in retail will provide more benefits to consumers through lower prices, wider availability and significant improvement in supply chain logistics.[85]

See also

External links


  1. ^ "The Bird of Gold - The Rise of India's Consumer Market". McKinsey and Company. May 2007.
  2. ^ Anand Dikshit (August 12, 2011). "The Uneasy Compromise - Indian Retail". The Wall Street Journal.
  3. ^ "Winning the Indian consumer". McKinsey & Company. 2005.
  4. ^ Majumder, Sanjoy (25 November 2011). "Changing the way Indians shop". BBC News.
  5. ^ a b "Retailing in India Unshackling the chain stores". The Economist. 29 May 2008.
  6. ^ a b Agarwal, Vibhuti; Bahree, Megha (7 December 2011). "India puts retails reforms on hold". The Wall Street Journal.
  7. ^ Sharma, Amol; Sahu, Prasanta (11 January 2012). "India Lifts Some Limits on Foreign Retailers". The Wall Street Journal.
  8. ^ Amol Sharma (24 June 2012). "IKEA Knocks on India's Door". The Wall Street Journal.
  9. ^ a b "Ikea shelves Indian retail market move". The Financial Times. 22 January 2012.
  10. ^ "Times of India Newsreport".
  11. ^ "Department of Industrial Policy & Promotion (FC-I Section), Press Note No.5 (2012 Series) - multi-brand retail". Ministry of Commerce & Industry, Government of India. 20 September 2012.
  12. ^ "Department of Industrial Policy & Promotion, Press Note No.4 (2012 Series) - Single brand retail". Ministry of Commerce & Industry, Government of India. 20 September 2012.
  13. ^ "FDI in multi-brand retail comes into effect; way clear for Walmart". The Economic Times. 20 September 2012.
  14. ^ "ICRIER Begins Survey of Indian Retail Sector." 19 March 2007.
  15. ^ "Global Economy: China, India confront WalMarts". Asia Times. 31 January 2004.
  16. ^ a b c d e "FDI IN MULTI-BRAND RETAIL TRADING". KPMG. 2010.
  17. ^ Mukherjee et al., Arpita (2006). FDI in Retail Sector: INDIA, A Report by ICRIER. Academic Foundation. ISBN 978-81-7188-480-3.
  18. ^ Mehta and Chatterjee (June 2011). "Growth and Poverty - the great debate". CUTS International.
  19. ^ Jagdish Bhagwati (14 December 2010). "Hiren Mukerjee Memorial Parliamentary Lecture: Parliament of India". Columbia University, Parliament of India.
  20. ^ "India again tops global retail index." 22 /6/ 2007.
  21. ^ "Economic and financial indicators" 3 July 2008.
  22. ^ "Indian Retail story from Myths to Mall." 11 August 2007.
  23. ^ a b c Bahree, Megha (November 25, 2011). "India Unlocks Door for Global Retailers". The Wall Street Journal.
  24. ^ "Wal-Mart Waits With Carrefour as India Wins Instant Gain: Retail". Bloomberg BusinessWeek. 30 November 2011.
  25. ^ a b "Indian retail: The supermarket's last frontier". The Economist. 3 December 2011.
  26. ^ "INDIAN RETAIL INDUSTRY: A Report". CARE Research. March 2011.
  27. ^ "Global Powers of Retailing 2011". Deloitte. 2011.
  28. ^ a b "India's retail reform: No massive rush". The Economist. 2 December 2011.
  29. ^ "Retail Global Expansion: A Portfolio of Opportunities". AT Kearney. 2011.
  30. ^ "Reasons to Invest in India".
  31. ^ "Fashion meets tech as handsets get sleek expensive"
  32. ^ "LCD televisions, laptops are flying off the shelves."
  33. ^ "Traditional Retail Trade in India." 28 June 2009.
  34. ^ "Mahindra joins the retail bandwagon, to sell lifestyle products"
  35. ^ "Bharti & Wal-Mart joint venture"
  36. ^ "Carrerfour readies plan to enter India's retail industry"
  37. ^ "Costco, US's fifth biggest, eying India?"
  38. ^ "Retail - India". McKinsey & Co..
  39. ^ "Retail Scenario in India"
  40. ^ a b "FDI POLICY IN MULTI BRAND RETAIL". Ministry of Commerce, Government of India. 28 November 2011.
  41. ^ a b Dhume, Sadanand (November 29, 2011). "India Goes Wild Over Wal-Mart". The Wall Street Journal.
  42. ^ "India government puts foreign supermarkets "on pause"". Reuters. 4 December 2011.
  43. ^ "India to put foreign supermarket plan on hold". The Financial Times. 3 December 2011.
  44. ^ "FDI in retail: Is it another nuclear deal moment?". The Economic Times. 4 December 2011.
  45. ^ "A good retail decision badly sold". India Today. 3 December 2011.
  46. ^ "Singh criticism mounts after retail U-turn". The Financial Times. 4 December 2011.
  47. ^ "FDI in retail: Corporate honchos call protests on false drama". The Economic Times. 4 December 2011.
  48. ^ Bahree, Megha (6 December 2011). "India Parliament Expected to Suspend Key Retail Proposal". The Wall Street Journal.
  49. ^ "Government of India, Ministry of Commerce & Industry, Department of Industrial Policy & Promotion, Press Note No.1 (2012 Series)". 11 January 2012.
  50. ^ "MIND THE GAP". Calcutta, India: The Telegraph. 1 December 2011.
  51. ^ a b c d Tripathi, Salil (29 December 2011). "India needs Supermarkets". London: The Guardian.
  52. ^ "Walmart Fact Sheets". Walmart. November 2011.
  53. ^ "Indian retail kings around the world". Rediff. 6 December 2011.
  54. ^ a b "Walmart Asia to make India an export hub". Business Standard. April 14, 2010.
  55. ^ Grant, Tavia (January 25, 2011). "The Wal-Mart effect: food inflation tame in Canada". Toronto: The Globe and Mail.
  56. ^ "For India's Consumers, Pepsi Is the Real Thing". Bloomberg BusinessWeek. 16 September 2010.
  57. ^ "Aam bania is more powerful than the aam aadmi". The Times of India. 4 December 2011.
  58. ^ "Whole Foods annual report, FY 2010". Whole Foods. 2011.
  59. ^ "Commerce Minister Anand Sharma speaks to NDTV on FDI". NDTV. 2 December 2011.
  60. ^ "Discussion Paper on Foreign Direct Investment (FDI) in Multi-Brand Trading". Indian Venture Capital and Private Equity Association. 2 August 2011.
  61. ^ a b "Backlash grows over reform of Indian retail". The Financial Express. 27 November 2011.
  62. ^ "Revolt escalates against Indian retail reform". The Financial Express. 27 November 2011.
  63. ^ a b Dhume, Sadanand (29 November 2011). "India goes wild over Wal-Mart". The Wall Street Journal.
  64. ^ "FDI: Bandh call gets mixed response". Indian Express. 2 December 2011.
  65. ^ "Gadkari's own chain remains open for biz". The Times of India. 2 December 2011.
  66. ^ Mehdudia, Sujay (1 December 2011). "Wholesale markets remain closed, kirana stores ignore bandh call". Chennai, India: The Hindu.
  67. ^ "India: A parliament in limbo". BBC News. 2 December 2011.
  68. ^ "Farmers and consumers favour FDI in retail". ASSOCHAM. 4 December 2011.
  69. ^ a b "Farmer Organisations back retail FDI". The Financial Express. 2 December 2011.
  70. ^ a b Suryamurthy, R. (2 December 2011). "Enter, farmer with an FDI in retail query". Calcutta, India: The Telegraph.
  71. ^ "FDI in retail is first major step towards reforms in agriculture, feels Sharad Joshi". The Economic Times. 2 December 2011.
  72. ^ "Major Benefits of FDI in Retail". The Reformist India. 30 November 2011.
  73. ^ "Sustainable rice production for food security". Food and Agriculture Organization of the United Nations. 2003.
  74. ^ Shah and Venkatesh (2009). "Opportunities for Food Industry in India". Indian Institute of Technology Bombay.
  75. ^ H. Basavaraja et al.. "Economic Analysis of Post-harvest Losses in Food Grains in India: A Case Study of Karnataka". Agricultural Economics Research Review 20: 117–126.
  76. ^ "India: Wholesale Reform". The Economist. 25 November 2011.
  77. ^ "Full Transcript: Your call with Professor Amartya Sen and Professor Jean Dreze". NDTV. 18 December 2011.
  78. ^ "Modi-led panel of CMs had suggested organized retail in report to PM". The Times of India. 1 December 2011.
  79. ^ "Sheila Dikshit Backs FDI in Retail". Outlook India. 30 November 2011.
  80. ^ "Haryana CM Hooda hails FDI in retail". Newstrack India. 30 November 2011.
  81. ^ "Government defends FDI in retail Industry, Shiromani Akali Dal hails reform". The Tribune. 30 November 2011.
  82. ^ "5 States are game for FDI in retail, says Sharma". The Hindu Business Line. 26 November 2011.
  83. ^ "After support from five states, govt's hopes high". Business Standard. 27 November 2011.
  84. ^ "Gogoi supports Centre on FDI issue". Zee News. 1 December 2011.
  85. ^ "Retailers upbeat on Centre's FDI move". India Today. 30 November 2011.


From Wikipedia, the free encyclopedia
Jump to: navigation, search
Wal-Mart Stores, Inc.
Type Public
Traded as NYSEWMT
Dow Jones Industrial Average Component
S&P 500 Component
Industry Retailing
Founded 1962
Founder(s) Sam Walton
Headquarters Bentonville, Arkansas, U.S.
36°21′51″N 094°12′59″W
Number of locations 8,970 (2011)
Area served Worldwide
Key people S. Robson Walton (Chairman)
Mike Duke (President & CEO)
Products Apparel/footwear specialty, cash & carry/warehouse club, discount department store, discount store, hypermarket/supercenter/superstore, supermarket
Revenue Increase US$ 446.950 billion (2012)[1]
Operating income Increase US$ 26.558 billion (2012)[1]
Net income Decrease US$ 15.699 billion (2012)[1]
Total assets Increase US$ 193.406 billion (2012)[1]
Total equity Increase US$ 71.315 billion (2012)[1]
Owner(s) Walton family
Employees 2.2 million (2012)[1]
Divisions Walmart Canada
Subsidiaries Asda, Sam's Club, Seiyu Group, Walmex
Website Wal-Mart
References: [2][3][4]

Wal-Mart Stores, Inc. (NYSEWMT), branded as Walmart, is an American multinational retailer corporation that runs chains of large discount department stores and warehouse stores. The company is the world's third largest public corporation, according to the Fortune Global 500 list in 2012. It is also the biggest private employer in the world with over two million employees, and is the largest retailer in the world. Walmart remains a family-owned business, as the company is controlled by the Walton family who own a 48% stake in Walmart.[5][6] It is also one of the world's most valuable companies.[7]

The company was founded by Sam Walton in 1962, incorporated on October 31, 1969, and publicly traded on the New York Stock Exchange in 1972. It is headquartered in Bentonville, Arkansas. Walmart is also the largest grocery retailer in the United States. In 2009, it generated 51% of its US$258 billion sales in the U.S. from grocery business.[8] It also owns and operates the Sam's Club retail warehouses in North America.[9][10]

Walmart has 8,500 stores in 15 countries, under 55 different names.[11] The company operates under the Walmart name in the United States, including the 50 states and Puerto Rico. It operates in Mexico as Walmex, in the United Kingdom as Asda, in Japan as Seiyu, and in India as Best Price. It has wholly owned operations in Argentina, Brazil, and Canada. Walmart's investments outside North America have had mixed results: its operations in the United Kingdom, South America and China are highly successful, whereas ventures in Germany and South Korea were unsuccessful.



Early years (1945–1969)

Sam Walton's original Walton's Five and Dime store in Bentonville, Arkansas, now serving as the Walmart Visitor Center

Sam Walton, a businessman from Arkansas, began his retail career when he started work on June 3, 1940, at a J. C. Penney store in Des Moines, Iowa where he remained for 18 months. In 1945, he met Butler Brothers, a regional retailer that owned a chain of variety stores called Ben Franklin and that offered him one in Newport, Arkansas.[12]

Walton was extremely successful in running the store in Newport, far exceeding expectations.[13] However, when the lease came up for renewal, Walton could neither come to agreement on the existing store's lease renewal nor find a new location in Newport. Instead, he opened a new Ben Franklin franchise in Bentonville, Arkansas, but called it "Walton's Five and Dime." There, he achieved higher sales volume by marking up slightly less than most competitors.[14]

On July 2, 1962, Walton opened the first Walmart Discount City store located at 719 Walnut Ave. in Rogers, Arkansas. The building is now occupied by a hardware store and an antique mall. Within five years, the company expanded to 24 stores across Arkansas and reached $12.6 million in sales.[15] In 1968, it opened its first stores outside Arkansas, in Sikeston, Missouri and Claremore, Oklahoma.[16]

Incorporation and growth (1969–2005)

The company was incorporated as Wal-Mart Stores, Inc. on October 31, 1969. In 1970, it opened its home office and first distribution center in Bentonville, Arkansas. It had 38 stores operating with 1,500 employees and sales of $44.2 million. It began trading stock as a publicly held company on October 1, 1970, and was soon listed on the New York Stock Exchange. The first stock split occurred in May 1971 at a market price of $47. By this time, Walmart was operating in five states: Arkansas, Kansas, Louisiana, Missouri, and Oklahoma; it entered Tennessee in 1973 and Kentucky and Mississippi in 1974. As it moved into Texas in 1975, there were 125 stores with 7,500 employees and total sales of $340.3 million.[16] Walmart opened its first Texas store in Mount Pleasant on November 11, 1975.[17]

In the 1980s, Walmart continued to grow rapidly, and by its 25th anniversary in 1987 there were 1,198 stores with sales of $15.9 billion and 200,000 associates.[16] This year also marked the completion of the company's satellite network, a $24 million investment linking all operating units of the company with its Bentonville office via two-way voice and data transmission and one-way video communication. At the time, it was the largest private satellite network, allowing the corporate office to track inventory and sales and to instantly communicate to stores.[18] In 1988, Sam Walton stepped down as CEO and was replaced by David Glass.[19] Walton remained as Chairman of the Board, and the company also rearranged other people in senior positions.

Inside a Walmart Supercenter in West Plains, Missouri

In 1988, the first Wal-Mart Supercenter opened in Washington, Missouri.[20] Thanks to its superstores, it surpassed Toys "R" Us in toy sales in the late 1990s.[21] The company also opened overseas stores, entering South America in 1995 with stores in Argentina and Brazil; and Europe in 1999, buying Asda in the UK for $10 billion.[22]

In 1998, Walmart introduced the "Neighborhood Market" concept with three stores in Arkansas.[23] By 2005, estimates indicate that the company controlled about 20% of the retail grocery and consumables business.[24]

In 2000, H. Lee Scott became President and CEO, and Walmart's sales increased to $165 billion.[25] In 2002, it was listed for the first time as America's largest corporation on the Fortune 500 list, with revenues of $219.8 billion and profits of $6.7 billion. It has remained there every year, except for 2006 and 2009.[26][27][28][29][30][31]

In 2005, Walmart had $312.4 billion in sales, more than 6,200 facilities around the world – including 3,800 stores in the United States and 2,800 elsewhere, employing more than 1.6 million "associates" worldwide. Its U.S. presence grew so rapidly that only small pockets of the country remained further than 60 miles (100 km) from the nearest Walmart.[32]

As Walmart grew rapidly into the world's largest corporation, many critics worried about the effect of its stores on local communities, particularly small towns with many "mom and pop" stores. There have been several studies on the economic impact of Walmart on small towns and local businesses, jobs, and taxpayers. In one, Kenneth Stone, a Professor of Economics at Iowa State University, found that some small towns can lose almost half of their retail trade within ten years of a Walmart store opening.[33] However, in another study, he compared the changes to what small town shops had faced in the past – including the development of the railroads, the advent of the Sears Roebuck catalog, as well as the arrival of shopping malls – and concluded that shop owners who adapt to changes in the retail market can thrive after Walmart arrives.[33] A later study in collaboration with Mississippi State University showed that there are "both positive and negative impacts on existing stores in the area where the new supercenter locates."[34]

In the aftermath of Hurricane Katrina in September 2005, Walmart was able to use its logistical efficiency in organizing a rapid response to the disaster, donating $20 million in cash, 1,500 truckloads of free merchandise, food for 100,000 meals, as well as the promise of a job for every one of its displaced workers.[35] An independent study by Steven Horwitz of St. Lawrence University found that Walmart, The Home Depot and Lowe's made use of their local knowledge about supply chains, infrastructure, decision makers and other resources to provide emergency supplies and reopen stores well before FEMA began its response.[36] While the company was overall lauded for its quick response – amidst the criticisms of the Federal Emergency Management Agency – several critics were nonetheless quick to point out that there still remain issues with the company's labor relations.[37]

Initiatives (2005–present)

In October 2005, Walmart announced it would implement several environmental measures to increase energy efficiency. The primary goals included spending $500 million a year to increase fuel efficiency in Walmart's truck fleet by 25% over three years and double it within ten, reduce greenhouse gas emissions by 20% in seven years, reduce energy use at stores by 30%, and cut solid waste from U.S. stores and Sam's Clubs by 25% in three years. CEO Lee Scott said that Walmart's goal was to be a "good steward for the environment" and ultimately use only renewable energy sources and produce zero waste.[38] The company also designed three new experimental stores in McKinney, Texas, Aurora, Colorado, and Las Vegas, Nevada. with wind turbines, photovoltaic solar panels, biofuel-capable boilers, water-cooled refrigerators, and xeriscape gardens.[39] Despite much criticism of its environmental record, Walmart took a few steps in what is viewed as a positive direction, which included becoming the biggest seller of organic milk and the biggest buyer of organic cotton in the world, as well as reducing packaging and energy costs.[40] Walmart also spent nearly a year working with outside consultants to discover the company's total environmental impact and find where they could improve. They discovered, for example, that by eliminating excess packaging on their toy line Kid Connection, they could not only save $2.4 million a year in shipping costs but also 3,800 trees and a million barrels of oil.[40] Walmart has also recently created its own electric company in Texas, Texas Retail Energy, and plans to supply its stores with cheap power purchased at wholesale prices. Through this new venture, the company expects to save $15 million annually and also lays the groundwork and infrastructure to sell electricity to Texas consumers in the future.[41]

In March 2006, Walmart sought to appeal to a more affluent demographic. The company launched a new Supercenter concept in Plano, Texas, intended to compete against stores seen as more upscale and appealing, such as Target.[42][43] The new store has wood floors, wider aisles, a sushi bar, a coffee/sandwich shop with free Wi-Fi Internet access, and more expensive beers, wines, electronics, and other goods. The exterior has a hunter green background behind the Walmart letters, similar to Neighborhood Market by Walmarts, instead of the blue previously used at its supercenters.

On September 12, 2007, Walmart introduced new advertising with the slogan, "Save Money Live Better," replacing the "Always Low Prices, Always" slogan, which it had used for the previous 19 years. Global Insight, which conducted the research that supported the ads, found that Walmart's price level reduction resulted in savings for consumers of $287 billion in 2006, which equated to $957 per person or $2,500 per household (up 7.3% from the 2004 savings estimate of $2,329).[44]

The exterior of the Walmart store in West Hills, California.

On June 30, 2008, Walmart unveiled a new company logo, featuring the non-hyphenated name "Walmart" and in place of the star, a symbol that resembles a sunburst or flower. The new logo received mixed reviews from some design critics, who questioned whether the new logo was as bold as competitors, such as the Target bullseye or as instantly recognizable as the former company logo, which was used for 18 years.[45] The new logo made its debut on the company's website on July 1, 2008. Walmart's U.S. locations were to update store logos in the fall of 2008, as part of an ongoing evolution of its overall brand.[46] Walmart Canada started to adopt the logo for its stores in early 2009.[citation needed]

On March 20, 2009, Walmart announced that it is paying a combined $933.6 million in bonuses to every full and part-time hourly worker of the company. An additional $788.8 million in profit sharing, 401(k) contributions, and hundreds of millions of dollars in merchandise discounts and contributions to the employees' stock purchase plan is also included in this plan. While the economy at large was in an ongoing recession, the largest retailer in the U.S. reported solid financial figures for the most recent fiscal year (ending January 31, 2009), with $401.2 billion in net sales, a gain of 7.2% from the prior year. Income from continuing operations increased 3% to $13.3 billion, and earnings per share rose 6% to $3.35.[47]

On July 16, 2009, Walmart announced plans to develop a worldwide sustainable product index.[48]

On February 22, 2010, the company confirmed it was acquiring video streaming company Vudu, Inc. for an estimated $100 million.[49]

In January 2011, at the urging of Michelle Obama and her staff, Walmart announced a program to improve the nutritional values of its store brands over the next five years, gradually reducing the amount of salt and sugar, and eliminating trans fat. Walmart also promised to negotiate with suppliers such as Kraft with respect to nutritional issues. Reductions in the prices of whole foods and vegetables were also promised as well as efforts to open stores in low-income areas, "food deserts", where there are no supermarkets.[50]

On April 23, 2011, the company announced that it was testing its new "Walmart To Go" home delivery system where customers will be able to order specific items offered on their website such as groceries, toiletries, and household supplies. The initial test is in San Jose, California, and the company has not said whether it will be rolled out nationwide.[51] On November 14, 2012, Walmart is launching their first mail subscription service named Goodies. It lets customers find new foods for a fee of $7 a month from the comfort of the couch.[52]

Operating divisions

Walmart's operations are organized into three divisions: Walmart Stores U.S., Sam's Club, and Walmart International.[9] The company does business in nine different retail formats: supercenters, food and drugs, general merchandise stores, bodegas (small markets), cash and carry stores, membership warehouse clubs, apparel stores, soft discount stores and restaurants.[9]

A panoramic photo of a remodeled Walmart Supercenter in Laurel, Maryland.

Walmart Stores U.S.

Map of Walmart stores in the U.S., as of August 2010.

Walmart Stores U.S. is the company's largest division, accounting for $258 billion, or 63.8% of total sales for financial year 2010.[9] It consists of three retail formats that have become commonplace in the United States: Discount Stores, Supercenters, and Walmart Markets. The retail department stores sell a variety of mostly non-grocery products, though emphasis has now shifted towards supercenters, which include more grocery items. This division also includes Walmart's online retailer,

In September 2006, Walmart announced a pilot program to sell generic drugs at just $4 per prescription. The pilot program was launched at stores in the Tampa, Florida area, and expanded to all stores in Florida by January 2007. While the average price of generics is $29 per prescription, compared to $102 for name-brand drugs, Walmart maintains that it is not selling at a loss, or providing as an act of charity – instead, they are using the same mechanisms of mass distribution that it uses to bring lower prices to other products.[53] While it's little known outside of the drug industry, many of Walmart's low cost generics are imported from India and made by drug makers in the country including drug majors Ranbaxy and Cipla.[54]

On February 6, 2007, the company launched a "beta" version of a movie download service, which sold about 3,000 films and television episodes from all major studios and television networks.[55] The service was discontinued on December 21, 2007, due to low sales.[56]

From 2008 through 2011, Walmart operated a pilot program in the small grocery store concept called Marketside in the metropolitan Phoenix, Arizona area. They plan to take what they have learned from this concept and incorporate that into their newer Walmart Express stores which they are developing.[57]

Walmart Discount Stores

A typical Walmart discount department store in Laredo, Texas

Walmart discount stores are discount department stores with size varying from 51,000 square feet (4,738.1 m2) to 224,000 square feet (20,810.3 m2), with an average store covering about 102,000 square feet (9,476.1 m2).[9] They carry general merchandise and a selection of groceries. Many of these stores also have a garden center, a pharmacy, Tire & Lube Express, optical center, one-hour photo processing lab, portrait studio, a bank branch, a cell phone store and a fast food outlet. Some also have gasoline stations.[58]

The first Walmart store opened in Rogers, Arkansas in 1962.

In 1990, Walmart opened its first Bud's Discount City location in Bentonville. Bud's operated as a closeout store, much like Big Lots. Many locations were opened to fulfill leases in shopping centers as Walmart stores left and moved into newly built Supercenters. All of the Bud's Discount City stores closed or converted into Walmart Discount Stores by 1997.[15][59]

As of March 2012, there were 629 Walmart discount stores in the United States. In 2006, the busiest in the world was one in Rapid City, South Dakota.[60]

Walmart Supercenter

A remodeled Wal-Mart Supercenter in Miami, Florida.

Walmart Supercenters are hypermarkets with size varying from 98,000 to 261,000 square feet (9,104.5 to 24,247.7 m2), with an average of about 197,000 square feet (18,301.9 m2).[9] These stock everything a Walmart discount store does, and also include a full-service supermarket, including meat and poultry, baked goods, delicatessen, frozen foods, dairy products, garden produce, and fresh seafood. Many Wal-Mart Supercenters also have a garden center, pet shop, pharmacy, Tire & Lube Express, optical center, one-hour photo processing lab, portrait studio, and numerous alcove shops, such as cellular phone stores, hair and nail salons, video rental stores, local bank branches (newer locations have Woodforest National Bank branches), and fast food outlets – usually Subway, but sometimes Dunkin' Donuts, McDonald's or Blimpie. Some also sell gasoline distributed by Murphy Oil Corporation (whose Walmart stations are branded as "Murphy USA"), Sunoco, Inc. ("Optima"), or Tesoro Corporation ("Mirastar").[58]

The first Supercenter opened in 1988, in Washington, Missouri. A similar concept, Hypermart USA, opened in Garland, Texas a year earlier. All of the Hypermart USA stores were later closed or converted into Supercenters.

As of March 2012, there were 3,029 Wal-Mart Supercenters in the United States.[60] The largest Supercenter in the United States, covering 260,000 square feet (24,154.8 m2) and two floors, is located in Crossgates Commons in Albany, New York.[61]

The "Supercenter" portion of the name on these stores has been phased out, simply referring to these stores as "Walmart," since the company introduced the new Walmart logo in 2008. The Supercentre portion of the name is still used on supercentres in Canada.

Walmart Market

Walmart Neighborhood Market in Houston, Texas

Walmart Market is a chain of grocery stores that average about 42,000 square feet (3,901.9 m2).[9] They are used to fill the gap between discount store and supercenters, offering a variety of products, which include full lines of groceries, pharmaceuticals, health and beauty aids, photo developing services, and a limited selection of general merchandise.

Previously branded as "Wal-Mart Neighborhood Market", the first store opened in 1998, in Bentonville, Arkansas. As of May 2012, there are 199 Walmart Neighborhood Markets.[60][62]

Supermercado de Walmart

Supermercado de Walmart in Spring Branch, Houston

Walmart opened "Supermercado de Walmart" locations to appeal to Hispanic communities in the United States.[63] The first one, a 39,000 square feet (3,600 m2) store in the Spring Branch area of Houston, opened on April 29, 2009.[64] The store was a conversion of an existing Walmart.[65][66] The opening was Wal-Mart's first entry in the Hispanic grocery market in Houston.[67] In 2009 another Supermercado de Walmart opened in Phoenix, Arizona.[68]

Walmart also planned to open "Mas Club," a warehouse retail operation patterned after Sam's Club.[69]

Walmart Express

Walmart Express is a smaller discount store, with a range of services, from simple grocery shopping, to check cashing, and even gasoline service. The concept is focused on small towns that are not able to support a larger store, and in large cities where physical space is at a premium.

Wal-Mart planned to build 15 to 20 Walmart Express stores, focusing on Arkansas, North Carolina and Chicago, by the end of its fiscal year in January 2012.

"This is about access to breadth of assortment", says Walmart's Anthony Hucker, vice president of strategy and business development.

As of December 2011, Walmart Express opened in Richfield, North Carolina, Snow Hill, North Carolina,[70] Gentry, Arkansas,[71] Prairie Grove, Arkansas,[72] Gravette, Arkansas[73] and Chicago, Illinois.[74][75]

Sam's Club

A typical Sam's Club store in Maplewood, Missouri

Sam's Club is a chain of warehouse clubs which sell groceries and general merchandise, often in large quantities. Sam's Club stores are "membership" stores and most customers buy annual memberships. However, non-members can make purchases either by buying a one-day membership or paying a surcharge based on the price of the purchase.[76] Some locations also sell gasoline.[58] The first Sam's Club opened in 1983 in Midwest City, Oklahoma[76] under the name "Sam's Wholesale Club".

Sam's Club has found a niche market in recent years as a supplier to small businesses. All Sam's Club stores are open early hours exclusively for business members and their old slogan was "We're in Business for Small Business." Their current[when?] slogan is "Savings Made Simple" as Sam's Club attempts to attract a more diverse member base. In March 2009, the company announced that it plans to enter the electronic medical records business by offering a software package to physicians in small practices for $25,000. Wal-Mart is partnering with Dell and in this new venture.[77]

Sam's Club's sales during 2010 were $47 billion, or 11.5% of Walmart's total sales.[9] As of March 2012, there are 611 Sam's Clubs in the United States.[10] Walmart also operates more than 100 international Sam's Clubs in Brazil, China, Mexico, and Puerto Rico.[10]

Walmart International

Walmart locations international

Walmart's international operations currently comprise 4,263 stores and 660,000 workers in 15 countries outside the United States.[78] There are wholly owned operations in Argentina, Brazil, Canada,and the UK. With 2.1 million employees worldwide, the company is the largest private employer in the US and Mexico, and one of the largest in Canada.[3] In the financial year 2010, Walmart's international division sales were $100 billion, or 24.7% of total sales.[9]

Walmart has operated in Canada since its acquisition of 122 stores comprising the Woolco division of Woolworth Canada, Inc in 1994. As of July 2010, it operates over 300 locations (including 100 Supercentres) and employs 82,000 Canadians, with a local home office in Mississauga, Ontario.[79] Walmart Canada's first three Supercentres (spelled as in Canadian English) opened on November 8, 2006, in Hamilton, London, and Aurora, Ontario. The 100th Canadian Supercentre opened on July 10, 2010, in Victoria, BC. In 2010, Walmart Canada Bank was introduced in Canada with the launch of the Walmart Rewards MasterCard.[80]

In the mid 1990s Wal-mart tried with a large financial investment to get a foothold in the German retail market. In 1997 Wal-mart took over the supermarket chain Wertkauf with its 21 stores for DEM750 million (€375 million)[81] and in 1998 Wal-mart took over 74 Interspar stores for DEM1.3 billion (€750 million).[82][83] Several reasons led to Wal-mart's failure in the German market.

The German market at this point was an oligopoly with high competition among the companies which also used a similar low price strategy as Wal-mart. Because of this, Wal-mart's low price strategy yielded no competitive advantage. Also Wal-mart's corporate culture was not viewed positively among employees and customers in Germany, particularly Wal-mart's "statement of ethics", which restricted relationships between employees and led to a public discussion in the media, resulting in a bad reputation for Wal-mart among customers.[84][85] Also Wal-mart's "Big Box – Low Price" Model, a price strategy that works well in the U.S., was not successful in Germany.

In July 2006, Wal-Mart announced its withdrawal from Germany due to sustained losses. The stores were sold to the German company Metro during Wal-Mart's fiscal third quarter.[86][87] Wal-mart did not disclose its losses from its ill fated German investment, but they were estimated around €3 billion.[88] At the same time, Wal-mart's competitors in Germany were able to increase their market share.

In 2004, Walmart bought the 116 stores in the Bompreço supermarket chain in northeastern Brazil. In late 2005, it took control of the Brazilian operations of Sonae Distribution Group through its new subsidiary, WMS Supermercados do Brasil, thus acquiring control of the Nacional and Mercadorama supermarket chains, the leaders in the Rio Grande do Sul and Paraná states, respectively. None of these was rebranded. As of April 2010, Wal-Mart operates 64 Super-Bompreço stores, 33 Hyper-Bompreço stores. It also runs 45 Wal-Mart Supercenters, 24 Sam's Club stores, and 101 Todo Dia stores. With the acquisition of Bompreço and Sonae, Walmart was in 2010 the third largest supermarket chain in Brazil, behind Carrefour and Pão de Açúcar.[89] Wal-Mart Brasil, the operating company, has its head office in Barueri, São Paulo State, and regional offices in Curitiba, Paraná; Porto Alegre, Rio Grande do Sul; Recife, Pernambuco; and Salvador, Bahia.[90]

In November 2006, the company announced a joint venture with Bharti Enterprises to open retail stores in India. As foreign corporations were not allowed to directly enter the retail sector in India, Walmart operated through franchises and handled the wholesale end.[91] The partnership involves two joint ventures; Bharti manages the front end involving opening of retail outlets, while Walmart takes care of the back end, such as cold chains and logistics. Bharti Walmart operates stores in India under the brand name "Best Price Modern Wholesale". The first store opened in Amritsar in May 2012. On September 14, 2012, the Government of India approved 51% FDI in multi-brand retails, subject to approvals by individual states, effective September 20, 2012.[92][93] In an interview with The Wall Street Journal, Walmart Stores Inc President and CEO, Asia Scott Price, stated that Walmart would be capable of opening stores in India within a time frame of 2 years. Price also said that the company expects to continue its partnership with Bharti Enterprises in operating Best Price Modern Wholesale.[94]

Walmart's UK subsidiary, Asda

Sales in 2006 for Walmart's UK subsidiary, Asda (which retains the name it had before acquisition by Walmart), accounted for 42.7% of sales of Walmart's international division. In contrast to the US operations, Asda was originally and still remains primarily a grocery chain, but with a stronger focus on non-food items than most UK supermarket chains other than Tesco. As of 2011, Asda had 523 stores, including 147 from the 2010 Netto acquisition. In addition to small suburban Asda stores, larger stores are branded Asda Walmart Supercentres, as well as Asda Superstores and Asda Living.[4][95][96]

In addition to its wholly owned international operations, Walmart has joint ventures in China and several majority-owned subsidiaries. Walmart's majority-owned subsidiary in Mexico is Walmex. In Japan, Walmart owns 100% of Seiyu as of 2008.[86][97] Additionally, Walmart owns 51% of the Central American Retail Holding Company (CARHCO), consisting of more than 360 supermarkets and other stores in Guatemala, El Salvador, Honduras, Nicaragua, and Costa Rica.[98]

In 2008, Walmart named German retailing veteran Stephan Fanderl as the president of Walmart Emerging Markets-East in an effort to, "explore retail business opportunities in Russia and neighboring markets." The market is estimated to be worth more than US$140 billion per year in food sales alone.[99]

In January 2009, the company acquired a controlling interest in the largest grocer in Chile, Distribucion y Servicio D&S SA.[100]

On September 28, 2010, Walmart announced it would buy Massmart Holdings Ltd. of Johannesburg, South Africa in a deal worth over $4 billion, giving the company its first stores in Africa.[11]

In February 2012, Walmart announced that the company raises its stake to 51 percent in Chinese Online Supermarket Yihaodian to tap rising consumer wealth and help the company offer more product. The stake expansion is subject to Chinese government regulatory approval.[101]


In February 2010, the company agreed to buy Vudu, a Silicon Valley start-up whose three-year-old online movie service is being built into an increasing number of televisions and Blu-ray players. Terms of the acquisition were not disclosed, but a person briefed on the deal said the price for the company, which raised $60 million in capital, was over $100 million.[102] It is the third most popular online movie service, with a market share of 5.3 percent.[103]

Private label brands

About 40% of products sold in Walmart are private label store brands, or products offered by Walmart and produced through contracts with manufacturers. Walmart began offering private label brands in 1991 with the launch of Sam's Choice, a brand of drinks produced by Cott Beverages exclusively for Walmart. Sam's Choice quickly became popular, and by 1993 was the third most popular beverage brand in the United States.[104] Other Walmart brands include Great Value and Equate in the US and Canada, and Smart Price in Britain. A 2006 study talked of "the magnitude of mind-share Walmart appears to hold in shoppers' minds when it comes to awareness of private label brands and retailers."[105]


In 2010, the company teamed with Procter & Gamble to produce Secrets of the Mountain and The Jensen Project, two-hour family movies which featured the characters using Walmart and Procter & Gamble branded products. The Jensen Project also featured a preview of a product to be released in several months in Walmart stores.[106][107] A third movie, A Walk in My Shoes, will air later in 2010 and a fourth is in production.[108] Walmart's director of brand marketing also serves as co-chair of the Association of National Advertisers's Alliance for Family Entertainment.[109]

Corporate affairs

Walmart Home Office in Bentonville, Arkansas

Walmart is headquartered in the Wal-Mart Home Office complex in Bentonville, Arkansas. The company's business model is based on selling a wide variety of general merchandise at "always low prices."[9] They refer to their employees as "associates". All Wal-Mart stores in the US and Canada also have designated "greeters" at the store entrance, a practice pioneered by founder Sam Walton and later copied by other retailers. Greeters are trained to help shoppers find what they want and answer their questions.[110] For many years, associates were identified in the store by their signature blue vest, but this was discontinued in June 2007 and replaced with more modern and professional khaki pants and polo shirts. The wardrobe change was part of a larger corporate overhaul for the store in an effort to increase sales and rejuvenate its stock price.[111]

Unlike many other retailers, Wal-Mart does not charge a slotting fee to suppliers for their products to appear in the store.[112] Instead, it focuses on selling more popular products and provides incentives for store managers to drop unpopular products, as well as asking manufacturers to supply more popular products.[112]

On September 14, 2006, the company announced that it would phase out its layaway program, citing declining use and increased costs.[113] Layaway ceased to be offered on November 19, 2006, and required merchandise pickup by December 8, 2006. Wal-Mart now focuses on other payment options, such as increased use of six- and twelve-month, zero-interest financing. The layaway location in most stores is now used for Wal-Mart's Site-To-Store program, which was introduced in March 2007. This enables customers to buy goods online with a free shipping option, and have goods shipped to the nearest store for pickup.[114]

Maggie Sans, representing Walmart, sat on the Private Enterprise Board as Secretary of the American Legislative Exchange Council.[115] On May 31, 2012, Walmart announced they were suspending their membership in the organization. Sans said:

"Previously, we expressed our concerns about ALEC's decision to weigh in on issues that stray from its core mission 'to advance the Jeffersonian principles of free markets.' We feel that the divide between these activities and our purpose as a business has become too wide. To that end, we are suspending our membership in ALEC."[116]

Finance and governance

For the fiscal year ending January 31, 2011, Wal-Mart reported a net income of $15.4 billion on $422 billion of revenue with a 24.7% gross profit margin). The corporation's international operations accounted for $109.2 billion, or 26.1%, of total sales.[2] It is the world's 18th largest public corporation, according to the Forbes Global 2000 list, and the largest public corporation when ranked by revenue.[117]

Wal-Mart is governed by a fifteen-member Board of Directors, which is elected annually by shareholders. Robson Walton, the eldest son of founder Sam Walton, serves as Chairman of the Board. Michael T. Duke serves as Chief Executive Officer (CEO), and Lee Scott, formerly CEO, serves as Chairman of the Executive Committee of the Board. Other members of the board include Aída Álvarez, Jim Breyer, M. Michele Burns, James Cash, Roger Corbett, Douglas Daft, David Glass, Marissa Meyer, Gregory B. Penner, Allen Questrom, Arne M. Sorenson, Jim Walton, Christopher J. Williams, and Linda S. Wolf.[2][118] Sam Walton died in 1992. After Walton's death, Don Soderquist, Chief Operating Officer and Senior Vice Chairman, became known as the "Keeper of the Culture."[119]

Notable former members of the board include Hillary Clinton (1985–1992)[120] and Tom Coughlin (2003–2004), the latter having served as Vice Chairman. Clinton left the board before the 1992 U.S. Presidential Election, and Coughlin left in December 2005 after pleading guilty to wire fraud and tax evasion for stealing hundreds of thousands of dollars from Wal-Mart.[121] On August 11, 2006, he was sentenced to 27 months of home confinement, five years of probation, and ordered to pay US$411,000 in restitution.[122]


In North America, Wal-Mart's primary competition includes department stores like Kmart, Target, ShopKo and Meijer, Canada's Zellers, Hart the Real Canadian Superstore and Giant Tiger, and Mexico's Comercial Mexicana and Soriana. Competitors of Wal-Mart's Sam's Club division are Costco, and the smaller BJ's Wholesale Club chain operating mainly in the eastern US. Wal-Mart's move into the grocery business in the late 1990s also set it against major supermarket chains in both the United States and Canada. Several smaller retailers, primarily dollar stores, such as Family Dollar and Dollar General, have been able to find a small niche market and compete successfully against Wal-Mart for home consumer sales.[123] In 2004, Wal-Mart responded by testing its own dollar store concept, a subsection of some stores called "Pennies-n-Cents."[124]

Wal-Mart also had to face fierce competition in some foreign markets. For example, in Germany it had captured just 2% of German food market following its entry into the market in 1997 and remained "a secondary player" behind Aldi with a 19% share.[125] In July 2006, Wal-Mart announced its withdrawal from Germany. Its stores were sold to German company Metro.[87] Wal-Mart continues to do well in the UK, and its Asda subsidiary is the second largest chain after Tesco.[126]

In May 2006, after entering the South Korean market in 1998, Wal-Mart withdrew and sold all 16 of its South Korean outlets to Shinsegae, a local retailer, for $882 million. Shinsegae re-branded the Wal-Marts as E-mart stores.[127]

Wal-Mart struggled to export its brand elsewhere as it rigidly tried to reproduce its model overseas. In China, Wal-Mart hopes to succeed by adapting and doing things preferable to Chinese citizens. For example, it found that Chinese consumers preferred to select their own live fish and seafood; stores began displaying the meat uncovered and installed fish tanks, leading to higher sales.[128]

Customer base

Street sign for Wal ★ Mart Drive near Gordon, Pennsylvania
A price of 15 cents on folders and notebooks

Each week, about 100 million customers, nearly one-third of the U.S. population, visit Walmart's U.S. stores.[129] Walmart customers give low prices as the most important reason for shopping there, reflecting the "Low prices, always" advertising slogan that Wal-Mart used from 1962 until 2006.[130] The average US Wal-Mart customer's income is below the national average, and analysts recently estimated that more than one-fifth of them lack a bank account, twice the national rate.[131] A Wal-Mart financial report in 2006 also indicated that Wal-Mart customers are sensitive to higher utility costs and gas prices.[132] A poll indicated that after 2004 US Presidential Election 76% of voters who shopped at Wal-Mart once a week voted for George W. Bush, while only 23% supported senator John Kerry.[133] When measured against other similar retailers in the U.S., frequent Wal-Mart shoppers were rated the most politically conservative.[134]

In 2006, Wal-Mart took steps to expand its US customer base, announcing a modification in its US stores from a "one-size-fits-all" merchandising strategy to one designed to "reflect each of six demographic groups – African-Americans, the affluent, empty-nesters, Hispanics, suburbanites and rural residents."[135] Around six months later, it unveiled a new slogan: "Saving people money so they can live better lives". This reflects the three main groups into which Wal-Mart categorizes its 200 million customers: "brand aspirationals" (people with low incomes who are obsessed with names like KitchenAid), "price-sensitive affluents" (wealthier shoppers who love deals), and "value-price shoppers" (people who like low prices and cannot afford much more).[130] Wal-Mart has also made steps to appeal to more liberal customers, for example, by rejecting the American Family Association's recommendations and carrying the DVD Brokeback Mountain, a love story between two gay cowboys in Wyoming.[136]

Economic impact

Kenneth Stone, Professor of Economics at Iowa State University, in a paper published in Farm Foundation in 1997, found that some small towns can lose almost half of their retail trade within ten years of a Wal-Mart store opening.[33] He compared the changes to previous competitors small town shops have faced in the past – from the development of the railroads and the Sears Roebuck catalog to shopping malls. He concludes that small towns are more affected by "discount mass merchandiser stores" than larger towns and that shop owners who adapt to the ever changing retail market can "co-exist and even thrive in this type of environment."[33]

One study found Wal-Mart's entry into a new market has a profound impact on its retail competition. When a Wal-Mart opens in a new market, median sales drop 40% at similar high-volume stores, 17% at supermarkets and 6% at drugstores, according to the June 2009 study by researchers at several universities and led by the Tuck School of Business at Dartmouth College.[137] A Loyola University Chicago study suggested that the impact a Wal-Mart store has on a local business is correlated to its distance from that store. The leader of that study admits that this factor is stronger in smaller towns and doesn't apply to more urban areas saying "It'd be so tough to nail down what's up with Wal-Mart".[138]

A June 2006 article published by the libertarian Ludwig von Mises Institute suggested that Wal-Mart has a positive impact on small business.[139] It argued that while Wal-Mart's low prices caused some existing businesses to close, the chain also created new opportunities for other small business, and so "the process of creative destruction unleashed by Wal-Mart has no statistically significant impact on the overall size of the small business sector in the United States."[140]

For the concern of jobs, a study commissioned by Wal-Mart with consulting firm Global Insight, found that its stores' presence saves working families more than US$2,500 per year, while creating more than 210,000 jobs in the U.S.[141][142] Alternately, the Economic Policy Institute estimates that between 2001 and 2006, Wal-Mart's trade deficit with China alone eliminated nearly 200,000 U.S. jobs.[143] Another study at the University of Missouri found that a new store increases net retail employment in the county by 100 jobs in the short term, half of which disappear over five years as other retail establishments close.[144]

Studies of Wal-Mart show consumers benefit from lower costs. Another study by Global Insight found that Wal-Mart's growth between 1985 and 2004 resulted in food-at-home prices that were 9.1% lower and overall prices (as measured by the Consumer Price Index) that were 3.1% lower than they would otherwise have been.[145] A 2005 story in The Washington Post reported that "Wal-Mart's discounting on food alone boosts the welfare of American shoppers by at least $50 billion per year."[146] A study in 2005 at the Massachusetts Institute of Technology (MIT) measured the effect on consumer welfare and found that the poorest segment of the population benefits the most from the existence of discount retailers.[147] A 2004 paper by two professors at Pennsylvania State University found that U.S. counties with Wal-Mart stores suffered increased poverty compared with counties without Wal-Marts.[148] They hypothesized, to explain their results: This could be due to the displacement of workers from higher-paid jobs in the retailers customers no longer choose to patronize, Wal-Mart providing less local charity than the replaced businesses, or a shrinking pool of local leadership and reduced social capital due to a reduced number of local independent businesses.[148] Dr Raj Patel, author of "Stuffed and Starved: Markets, Power and the Hidden Battle for the World Food System", said in a lecture at the University of Melbourne on September 18, 2007, that a study in Nebraska looked at two different Wal-Marts, the first of which had just arrived and "was in the process of driving everyone else out of business but, to do that, they cut their prices to the bone, very, very low prices". In the other Wal-Mart, "they had successfully destroyed the local economy, there was a sort of economic crater with Wal-Mart in the middle; and, in that community, the prices were 17 percent higher".[149]

Employee and labor relations

A protest in Utah against Wal-Mart

Labor unions, Christian organizations,[150][151] and environmental groups[152] have criticized Wal-Mart for its policies and/or business practices. In particular, several labor unions blame Wal-Mart workers' unwillingness to join their organizations on the company's anti-union stance. Others disapprove of the corporation's extensive foreign product sourcing, treatment of employees and product suppliers, environmental practices, and use of public subsidies, and the impact of stores on the local economies of towns in which they operate.[153][154][155]

In 2005, two campaigns were launched: the (United Food and Commercial Workers) launched Wake Up Wal-Mart and The Center for Community and Corporate Ethics launched Wal-Mart Watch.[156][157] By the end of 2005, Wal-Mart launched Working Families for Wal-Mart, an operation managed by Wal-Mart to tell the company's side of the story. Additional efforts to counter criticism included a PR campaign in 2005, managed through its PR website,[158] as well as several television commercials. The company retained the PR firm Edelman to respond to negative media attention,[159] and started interacting directly with bloggers by sending them news, suggesting topics for postings, and sometimes inviting them to visit its corporate headquarters.[160] Similarly, in 2010, several of Wal-Mart's opponents have hired The Saint Consulting Group to support grass-roots campaigns against Wal-Mart. The most notable of these include grocery chains such as Safeway Inc., SuperValu, and Ahold, concerned that the presence of Wal-Mart will add more competition to their operations.[161]

In June 2006, Walmart was excluded from the investment portfolio of The Government Pension Fund of Norway, which held stock values of about US$ 430 million in the company, due to a social audit into alleged labor rights violations in the company's operations in the US and worldwide.[162][163] Although Walmart did not respond to questions from the fund's auditors, the company later claimed the decision "don't appear to be based on complete information".[164]

In the past, Walmart has been accused of locking night-shift workers in at night,[165] paying employees below minimum wage, and exposing employees to health hazards.[163] Wal-Mart's own "Standards for Suppliers" reports document extensive problems of this kind among the company's "directly-sourced" factories.[166] Full-time Wal-Mart employees earn an average of $10.78 per hour, but critics point out that the starting pay can be far lower – placing some employees with children below the poverty line – and that payrates do not rise as quickly as with unionized companies.[167] Others decry low levels of health coverage or overpriced health insurance, though the company reports that it offers rates as low as $5 per month in some areas ($9 per month nationwide) and that 92% of its associates are insured (though not necessarily through Wal-Mart).[168] Other grievances regard poor working conditions, unfavorable employer-employee relationships, and anti-union policies. Many suggest that Wal-Mart's high annual turnover-rate of ~70% shows that workers are dissatisfied and maltreated.[167]

In response, Jay Nordlinger of National Review argues that Wal-Mart is attacked simply because it is a leader of the Fortune 500 list or the largest employer in America, and a "free-market success story".[169] Penn & Teller devoted an episode of Bullshit! to an analysis of Wal-Mart criticism as a social movement. They theorized that despite the noble rhetoric, the real motivation of "Wal-Mart haters" was rooted in human psychology. They suggested that hating Wal-Mart permits a person "to feel better about themselves" for three main reasons: They "don't run a greedy international conglomerate", they aren't Wal-Mart workers, widely considered "low-skilled, minimum wage drones", and they aren't Wal-Mart customers thought of as "toothless, welfare-getting hillbillies".[170] Wal-Mart stores are unionized in every country outside of North America.[171]

Wal-Mart has opposed the Employee Free Choice Act (EFCA), which would make it easier for workers to unionize by removing the employer's ability to demand a secret ballot in union elections, and which would require mandatory arbitration of labor disputes. In mid-2008, the company required store managers and department heads to attend meetings at which opposition to the EFCA was used as a fulcrum for criticism of Democratic candidates in the elections for the United States Senate and the House of Representatives, as well as of the presumptive Democratic Presidential nominee, Senator Barack Obama. At these meetings, Wal-Mart human resources managers warned that Democratic victories might result in passage of the EFCA and hence more unionization. At one meeting, a Wal-Mart customer service supervisor from Missouri stated, "I am not telling you how to vote, but if the Democrats win, this bill will pass and you won't have a vote on whether you want a union.[172] A Wal-Mart spokesman, while acknowledging that the meetings were taking place nationwide, said, "If anyone representing Wal-Mart gave the impression we were telling associates how to vote, they were wrong and acting without approval."[172] Several labor-rights groups including the AFL-CIO have asked the Federal Election Commission to investigate whether Wal-Mart broke federal election rules by advocating against Democratic candidate Barack Obama in meetings with employees.[173]

The Wal-Mart store in Quanzhou, Fujian, China

According to a Newsweek article, Wal-Mart, after years of fierce fighting, accepted organized labor in China.[174]

In 2011, Wal-Mart sub-contractors, Impact Logistics and Premiere Warehousing Ventures, which were employed through Schneider Logistics warehouses in Mira Loma, California were fined by the California State Labor Department for disregarding federal and state wage laws.[175] "California Labor Commissioner Julie Su said in an interview that the Schneider facility on South Hamner Avenue is actually two buildings, and that most of the goods that move through the distribution center go to area Wal- Mart stores.".[176] Warehouse Workers United (WWU) filed a complaint with Wal-Mart CEO Mike Duke (October, 2011) and with the Wal-Mart Ethics Office (January, 2012) noting that the conditions in this warehouse violate Wal-Mart's own 'Statement of Ethics'. "The complaint details widespread wage-theft resulting from a piece-rate system for unloading containers, failure to pay employees for the time they actually worked and other violations of state and federal wage and hour law." In response, WWU received a 'Dear Customer' letter from Wal-Mart."[177]

Gender and sexual orientation

In 2007, a gender discrimination lawsuit, Dukes v. Wal-Mart Stores, Inc., was filed against Walmart, alleging that female employees were discriminated against in matters regarding pay and promotions. A class action suit was sought, which would have been the nation's largest in history, covering 1.5 million past and current employees of Wal-Mart.[178] On June 20, 2011, the United States Supreme Court ruled in Wal-Mart's favor, stating that the plaintiffs did not have enough in common to constitute a class.[179] The court ruled unanimously that because of the variability of the plaintiffs' circumstances, the class action could not proceed as presented, and furthermore, in a 5–4 decision that it could not proceed as any kind of class action suit.[180] However, several plaintiffs, including Ms. Dukes, still intend to file individual discrimination lawsuits separately.[181]

According to a consultant hired by plaintiffs in a sex discrimination lawsuit, in 2001, Wal-Mart's EEOC filings showed that female employees made up 65% of Wal-Mart's hourly paid workforce, but only 33% of its management.[182][183] Just 35% of its store managers were women, whereas 57% were at comparable retailers.[183] Wal-Mart says comparisons with other retailers are unfair, because it classifies employees differently; if department managers were included in the totals, women would make up 60% of the managerial ranks.[183] Others have criticized the lawsuit as without basis in the law and as an abuse of the class action mechanism.[184][185][186] In 2007, Wal-Mart was named by the National Association for Female Executives as one of the top 35 companies for Executive Women.[187]

Wal-Mart's rating on the Human Rights Campaign's Corporate Equality Index, a measure of how companies treat LGBT employees and customers, has fluctuated widely during the past decade, from a low of 14% (2002) to 65% (2006). They were praised for expanding their antidiscrimination policy protecting gay and lesbian employees,[188] as well as for a new definition of "family" that included same-sex partners.[189][190] However, they have been criticized in other areas, such as not renewing its membership in the National Gay and Lesbian Chamber of Commerce, which is reflected in their 2008 rating of 40% (compared to Target at 80% and Kmart at 100%).[191]

In January 2006, Wal-Mart announced that "diversity efforts include new groups of minority, female and gay employees that meet at Wal-Mart headquarters in Bentonville to advise the company on marketing and internal promotion. There are seven Business Resource Groups: women, African-Americans, Hispanics, Asians, Native Americans, Gays and Lesbians, and a disabled group."[192]

See also

Television and film



  1. ^ a b c d e f "2012 Form 10-K, Wal-Mart Stores, Inc.". Google.
  2. ^ a b c "Wal-Mart Form 10K: Portions of Annual Report to Shareholders". United States Securities and Exchange Commission. Retrieved June 28, 2011.
  3. ^ a b Wal-Mart Corporate and Financial Facts PDF." Wal-Mart Stores, Inc. Retrieved June 6, 2010.
  4. ^ a b "UK Fact Sheet". Wal-Mart Stores, Inc. August 2011. Retrieved April 23, 2012.
  5. ^ Worstall, Tim (December 14, 2011). "Six Waltons Have More Wealth Than the Bottom 30 % of Americans". Forbes.
  6. ^ Troy, Mike (April 21, 2011). "Walton family ownership reaches 48.2% level". RetailingToday.
  7. ^ "Market Cap Rankings". Ycharts. Zacks Investment Research. April 8, 2012. Retrieved April 9, 2012.
  8. ^ Ann Zimmerman (June 7, 2010). "Rival Chains Secretly Fund Opposition to Walmart". The Wall Street Journal. Retrieved 2010-06-08.
  9. ^ a b c d e f g h i j "Walmart 2010 Annual Report PDF (13.4 MB)." Walmart. 2010. Retrieved October 22, 2010.
  10. ^ a b c "Sam's Club." Wal-Mart Stores, Inc. Retrieved March 5, 2011.
  11. ^ a b Daniel, Fran (September 29, 2010). "Head of Walmart tells WFU audience of plans for growth over next 20 years". Winston-Salem Journal. Retrieved 2010-09-29.
  12. ^ Walton, Sam; Huey, John. Sam Walton: Made in America: My Story. New York: Bantam, 1993. ISBN 978-0-553-56283-5.
  13. ^ Sam Walton: Great From the Start – HBS Working Knowledge
  14. ^ Frank, T.A. (April 1, 2006). "A Brief History of Wal-Mart". The Washington Monthly. Retrieved July 24, 2006.
  15. ^ a b "The Rise of Walmart". Frontline: Is Wal-Mart Good for America?. November 16, 2004. Retrieved 2007-09-19.
  16. ^ a b c "The Wal-Mart Timeline." Wal-Mart (published on Retrieved July 24, 2006.
  17. ^ Halkias, Maria (October 30, 2005). "Living with Walmart 30 years later, Texas both cheers and fears discount behemoth Lone Star State has been changed, as has giant retailer". The Dallas Morning News. Retrieved February 22, 2011.
  18. ^ Ranade, Sudhanshu (July 17, 2005). "Satellite Adds Speed to Wal-Mart". The Hindu Business Line. Retrieved July 24, 2006.
  19. ^ Longo, Donald (February 15, 1988). "Wal-Mart Hands CEO Crown to Glass – David Glass". Discount Store News. Retrieved April 1, 2008.
  20. ^ "Wal-Mart Tests Similar Hypermarkets – Hypermart USA, Wal-Mart SuperCenter". Discount Store News. March 28, 1988. Retrieved April 19, 2007.
  21. ^ Byrnes, Nanette; Eidam, Michael (March 29, 2004). "Toys 'R' Us: Beaten at Its Own Game". BusinessWeek. Retrieved July 25, 2006.
  22. ^ Buerkle, Tom (June 15, 1999). "$10 Billion Gamble in U.K. Doubles Its International Business: Wal-Mart Takes Big Leap into Europe". International Herald Tribune. Retrieved April 19, 2007.
  23. ^ "Neighborhood Markets." Wal-Mart. Retrieved April 19, 2007.[dead link]
  24. ^ Ortiz, John (October 26, 2005). "Can Kroger Slow Wal-Mart?". Deseret Morning News. Retrieved July 25, 2006.[dead link]
  25. ^ "2000 Annual Report: Net Sales." Walmart. Retrieved April 19, 2007.[dead link]
  26. ^ "Fortune 500 2007". Fortune. April 16, 2007. Retrieved July 15, 2007.
  27. ^ "Fortune 500 2006". Fortune. April 17, 2006. Retrieved July 15, 2007.
  28. ^ "Fortune 500 2008". Fortune.
  29. ^ "Fortune 500 2009". Fortune.
  30. ^ "Fortune 500 2010". Fortune.
  31. ^ "Fortune 500 2011". Fortune.
  32. ^ Zook, Matthew; Graham, Mark (2006). "Wal-Mart Nation: Mapping the Reach of a Retail Colossus". In Brunn, Stanley D.. Wal-Mart World: The World's Biggest Corporation in the Global Economy. Routledge. pp. 15–25. ISBN 978-0-415-95137-1.
  33. ^ a b c d Stone, Kenneth E. (1997). "Impact of the Wal-Mart Phenomenon on Rural Communities". (Published in Proceedings: Increased Understanding of Public Problems and Policies – 1997. Chicago, Illinois: Farm Foundation). Iowa State University. Retrieved August 4, 2006.
  34. ^ Stone, Kenneth E.; Georgeanne Artz, Albert Myles (2003). "The Economic Impact of Wal-Mart Supercenters on Existing Businesses in Mississippi". Mississippi State University. Retrieved August 4, 2006.[dead link]
  35. ^ Barbaro, Michael; Gillis, Justin (September 6, 2005). "Wal-Mart at Forefront of Hurricane Relief". The Washington Post. Retrieved 2009-03-10.
  36. ^ Huffman, Mark (April 2, 2008). "Real Katrina hero? Walmart, study says". MSN. Retrieved 2009-03-10.
  37. ^ Bhatnagar, Parija (September 9, 2005). "Wal-Mart redeems itself, but what's next". CNN. Retrieved 2009-03-10.
  38. ^ "Is Wal-Mart Going Green?". MSNBC. October 25, 2005. Retrieved November 8, 2007.
  39. ^ Berner, Robert (September 22, 2005). "Can Wal-Mart Wear a White Hat?". BusinessWeek. Retrieved July 24, 2006.
  40. ^ a b Gunther, Mark (July 27, 2006). "Wal-Mart sees green". CNN. Retrieved November 8, 2007.
  41. ^ Souder, Elizabeth (January 28, 2007). "Will Wal-Mart Sell Electricity One Day?". RedOrbit. Retrieved March 31, 2008.
  42. ^ Koenig, David. "Wal-Mart Targeting Upscale Shoppers." ABC News. March 22, 2006.
  43. ^ "Wal-Mart turns attention to upscale shoppers". MSNBC. March 23, 2006. Retrieved December 1, 2007.
  44. ^ "Wal-Mart Rolling out New Company Slogan". Reuters via The New York Times. September 12, 2007. Retrieved September 26, 2007.[dead link]
  45. ^ Armin (June 30, 2008). "Less Hyphen, More Burst for Walmart". Brand New. UnderConsideration LLC. Retrieved August 9, 2010.
  46. ^ Jana, Reena (July 2, 2008). "Wal-Mart Gets a Facelift". BusinessWeek. Retrieved 2008-07-07.
  47. ^ Talley, Karen (March 20, 2009). "UPDATE: Walmart Giving US Employees $2B In Yearly Award Pgm". The Wall Street Journal. Retrieved 2009-03-20.[dead link]
  48. ^ Walmart Announces Sustainable Product Index
  49. ^ "Walmart Re-Enters Digital Downloading of Movies With Purchase of Vudu". The Wall Street Journal. February 22, 2010.
  50. ^ Sheryl Gay Stolberg (January 20, 2011). "Walmart Shifts Strategy to Promote Healthy Foods". The New York Times. Retrieved January 19, 2011.
  51. ^ "Got groceries?". The Herald Bulletin. April 23, 2011. Retrieved 2011-05-23.
  52. ^ "Wal-Mart launches food subscription service". USA Today. Retrieved November 14, 2012.
  53. ^ Silberner, Joanne (September 21, 2006). "Wal-Mart to Sell Generic Drugs for $4". All Things Considered (National Public Radio). Retrieved 2009-03-10.
  54. ^ "Pharma firms boost Wal-Mart revenues". Business Standard. June 16, 2008.
  55. ^ "Wal-Mart Launches Online Movie Download Service". Fox News. February 6, 2007. Retrieved February 14, 2007.
  56. ^ Matt Richtel; Brad Stone (January 1, 2008). "Wal-Mart's movie download service passes into ignominy". The New York Times. Retrieved January 2, 2008.
  57. ^ Jarman, Max (October 16, 2011). "Walmart closes its 4 Marketside stores in the Phoenix area.". Arizona Republic. Retrieved July 22, 2012.
  58. ^ a b c Longo, Don. "Gasoline a Logical Extension of Wal-Mart's Reach[dead link]." Convenience Store News. November 1, 2007. Retrieved November 1, 2007.
  59. ^ Wal-Mart shuttering 7-year old Bud's chain – Bud's Discount City | Discount Store News | Find Articles at
  60. ^ a b c "Corporate Profile." Walmart. Retrieved March 5, 2012.
  61. ^ " Largest Wal-Mart Supercenter In US Finds Home In Albany NY" Retrieved December 23, 2008.
  62. ^ Banjo, Shelly (May 17, 2012). "Can Wal-Mart Think Small?". The Wall Street Journal: p. B2. Retrieved May 17, 2012.
  63. ^ "Wal-Mart woos Hispanics with new Supermercado." Reuters. Retrieved December 20, 2009.
  64. ^ "New Supermercado de Walmart Opens in Houston." Wal-Mart. April 28, 2009. Retrieved June 28, 2010.
  65. ^ Wollam, Allison (March 20, 2009). "Walmart chooses Houston as test market for Supermercado de Walmart". Houston Business Journal. Retrieved June 28, 2010.
  66. ^ Serrano, Shea. "Houston Soon to Have Supermercado de Walmart." March 23, 2009. Retrieved June 28, 2010.
  67. ^ Waslh, Robb (June 8, 2009). "Wal-Mart Goes Tex-Mex". Houston Press. Retrieved February 1, 2012.
  68. ^ Burwell, Sloane (June 17, 2009). "Viva El Mercado: Supermercado De Walmart". Phoenix New Times. Retrieved February 1, 2012.
  69. ^ Moreno, Jenalia (April 30, 2009). "Walmart gives its Supermercado concept a tryout". Houston Chronicle. Retrieved June 29, 2010.
  70. ^ "N.C. is test market for smaller Walmart Express stores". News & Record. July 21, 2012. Retrieved 2012-07-21.
  71. ^ Wal-Mart Unveils Tiny Walmart Express in Arkansas – ABC News
  72. ^ Walmart Express Opens, Local Businessowners Aren't Happy – Wal-Mart Extended Coverage News Story – KHBS NW Arkansas
  73. ^ Krier, Garret (August 31, 2011). "Walmart Express Opens in Gravette". Retrieved January 10, 2012.
  74. ^ Walmart pushes into urban America |
  75. ^ Chicago Sun-Times. December 1, 2011.
  76. ^ a b "About Sam's Club." Sam's Club. Retrieved November 1, 2007.
  77. ^ Lohr, Steve (March 10, 2009). "Wal-Mart Plans to Market Digital Health Records System". The New York Times. Retrieved 2009-03-11.
  78. ^ "Wal-Mart International." Wal-Mart. Retrieved October 22, 2010.
  79. ^ Walmart Canada – Save Money Live Better[dead link]. Retrieved July 22, 2010.
  80. ^ "Walmart Canada Bank launches Walmart Rewards MasterCard". June 15, 2010. Retrieved June 29, 2011.
  81. ^ "Metro übernimmt Wal-Mart". (in German). ka-news. August 3, 2006
  82. ^ "Schnitte". (in German). Die Zeit.
  83. ^ "In Deutschland ein Zwerg". (in German). Stern. February 18, 2005.
  84. ^ "Auch Wal-Mart-Mitarbeiter dürfen lieben" (in German). Stern. November 15, 2005.
  85. ^ "Wal-Mart-Mitarbeiter dürfen flirten". (in German). Die Welt. November 15, 2005.
  86. ^ a b "Wal-Mart Reports Third Quarter Sales and Earnings." Wal-Mart. November 14, 2006. Retrieved November 14, 2006.
  87. ^ a b "Wal-Mart Abandons German Venture". BBC News. July 28, 2006. Retrieved July 31, 2006.
  88. ^ Spiegel: "Warum der US-Titan scheiterte". (in German). Der Spiegel. July 28, 2006.
  89. ^ "Brazil Operations." Wal-Mart Stores, Inc. June 2010. Retrieved June 6, 2010.
  90. ^ "No Brasil." Wal-Mart Brasil. Retrieved November 7, 2011.
  91. ^ Giridharadas A., Rai S. "Wal-Mart to Open Hundreds of Stores in India". The New York Times. November 27, 2006. Retrieved November 27, 2006.
  92. ^ "Times of India Newsreport".
  93. ^ "Department of Industrial Policy & Promotion (FC-I Section), Press Note No.5 (2012 Series) – multi brand retail". Ministry of Commerce & Industry, Government of India. September 20, 2012.
  94. ^
  95. ^ ASDA Careers: All about ASDA Stores. Retrieved August 7, 2011
  96. ^ "Wal-mart United Kingdom. Wal-Mart Stores, Inc. Retrieved June 8, 2010.
  97. ^
  98. ^ "Wal-Mart SEC Form 10-K." U.S. Securities and Exchange Commission. January 31, 2006. Retrieved July 26, 2006.
  99. ^ "Walmart considers move into Russia". MSNBC. April 14, 2008. Retrieved 2009-02-16.
  100. ^ Attwood, James (January 23, 2009). "Wal-Mart Completes Takeover of Chilean Grocer D&S (Update4)". Bloomberg L.P.. Retrieved 2009-02-16.
  101. ^ "Wal-Mart Raises Stake to 51% in Chinese Website Yihaodian". Bloomberg. February 20, 2012.
  102. ^ Stone, Brad (February 22, 2010). "Walmart Buying Vudu Movie Service". The New York Times. Retrieved February 23, 2010.
  103. ^ Bustillo, Miguel; Talley, Karen (August 29, 2011). "For Wal-Mart, a Rare Online Success". The Wall Street Journal: p. B1.
  104. ^ "Sam's Choice Climbs Beverage Brand List – Walmart's Sam's American Choice Beverage Brand". Discount Store News. October 4, 1993. Retrieved April 20, 2007.
  105. ^ Reyes, Sonia (August 21, 2006). "Study: Wal-Mart Private Brands Are Catching On". Brandweek. Retrieved August 23, 2006.[dead link]
  106. ^ "Walmart Pushing Limited $199 Kinect Pre-Order Bundle". PCWorld. Retrieved July 18, 2010.
  107. ^ McNamara, Mary (July 16, 2010). "Television review: 'The Jensen Project'". Los Angeles Times. Retrieved July 16, 2010.
  108. ^ Kiesewette, John. "Second P&G Family Friendly Movie Airs July 16 On NBC". The Cincinnati Enquirer. Retrieved July 9, 2010.
  109. ^ Stanley, T.L. (June 22, 2010). "Advertisers earmark $10 million for family-friendly TV". Los Angeles Times.
  110. ^ Kendall, Gerald I. (1998). Securing the future: strategies for exponential growth using the theory of constraints.. Boca Raton, Florida: CRC Press. p. 106. ISBN 1-57444-197-3.
  111. ^ "Wal-Mart Replaces Blue Vests". ABC News. June 18, 2007. Retrieved June 28, 2011.
  112. ^ a b Nelson, Emily (April 20, 2001). "Too Many Choices – Nine Kinds of Kleenex Tissue, Eggo Waffles in 16 Flavors: Blame Brand Managers". The Wall Street Journal. Retrieved August 1, 2006.
  113. ^ Staff Writer. "Wal-Mart Will Phase Out Layaway Program." Wal-Mart. September 14, 2006. Retrieved October 8, 2006.
  114. ^ McCarthy, Caroline (March 6, 2007). "Free Shipping from Store Pickup". CNET. Retrieved November 1, 2007.
  115. ^ "Private Enterprise Board". American Legislative Exchange Council. 2012. Retrieved April 21, 2012.
  116. ^
  117. ^ "The World's Biggest Public Companies". Forbes. April 2011. Retrieved June 28, 2011.
  118. ^ Sorkin, Andrew R.; Rusli, Evelyn M. (July 16, 2012). "A Yahoo Search Calls Up a Chief From Google.". New York Times. Retrieved July 20, 2012.
  119. ^ Soderquist, Donald (April 19, 2005). The Wal-mart Way: The Inside Story of the Success of the World's Largest Company (2nd ed.). Thomas Nelson. ISBN 978-0-7852-6119-3.
  120. ^ Harkavy, Ward (May 24, 2000). "Wal-Mart's First Lady". The Village Voice. Retrieved August 3, 2006.
  121. ^ Boulden, Jennifer (January 31, 2006). "Wal-Mart Former Vice Chairman Coughlin Admits Fraud". Bloomberg. Retrieved August 3, 2006.
  122. ^ Staff Writer. "Former Wal-Mart Exec Sentenced at the Wayback Machine (archived August 28, 2006)." CNN. August 11, 2006. Retrieved August 11, 2006.[dead link]
  123. ^ Stilgoe, John (November 23, 2003). "Wal-Mart Giant Can Be Tamed". The Boston Globe. Retrieved January 11, 2006.
  124. ^ Berner, Robert (May 10, 2004). "Out-Discounting the Discounter". BusinessWeek.
  125. ^ Ewing, Jack (April 11, 2005). "Wal-Mart: Struggling in Germany". BusinessWeek. Retrieved July 27, 2006.
  126. ^ Fairlamb, David; Laura Cohn (October 6, 2003). "A Bumpy Ride in Europe". BusinessWeek. Retrieved July 27, 2006.
  127. ^ Sang-Hun, Choe (May 23, 2006). "Wal-Mart Selling Stores and Leaving South Korea". The New York Times. Retrieved December 2, 2007.
  128. ^ Trunick, Perry A (January 2006). "Wal-Mart Reinvents Itself in China". Logistics Today. Retrieved November 1, 2007.[dead link]
  129. ^ Zimmerman, Ann; Hudson, Kris (April 17, 2006). "Managing Wal-Mart" (PDF). Retrieved April 3, 2007.[dead link]
  130. ^ a b Barbaro, Michael (March 2, 2007). "It's Not Only about Price at Wal-Mart". The New York Times. Retrieved April 3, 2007.
  131. ^ Weston, Liz Pulliam. "The Basics: National Bank of Wal-Mart?" MSN Money. Retrieved April 3, 2007.
  132. ^ Schumacher, Carol; Tureman, Pauline; Clark, Sarah. "Wal-Mart Reports Second Quarter Sales and Earnings[dead link]." Wal-Mart. August 15, 2006. Retrieved April 3, 2007.
  133. ^ "Zogby: Bush Job Approval – 34%[dead link]." Zogby International. August 16, 2006. Retrieved April 3, 2007.
  134. ^ Birchall, Jonathan; Yeager, Holly. "A Purchase on Psephology." Financial Times. August 17, 2006. Page 9, US edition.
  135. ^ "Wal-Mart to Drop One-Size-Fits-All Approach." CNBC. 2006. Retrieved April 3, 2007.
  136. ^ "Wal-Mart Selling 'Brokeback' DVD Despite Anti-Gay Protest[dead link]." CBC. April 6, 2006. Retrieved April 3, 2007.
  137. ^ Chicago Tribune, Wal-Mart Impact: Pop Price War Warns of Wal-Mart Impact for Chicago, July 4, 2010, Julie Wernau,,0,5230113.story
  138. ^ Mui, Ylan Q. (June 23, 2008). "When Wal-Mart Moves In, Neighborhood Businesses Suffer. Right?". The Washington Post.
  139. ^ Kirklin, Paul. (June 28, 2006). "The Ultimate pro-WalMart Article". Ludwig von Mises Institute. Retrieved August 17, 2006.
  140. ^ Sobel, Russell S.; Andrea M. Dean. "Has Wal-Mart Buried Mom and Pop?: The Impact of Wal-Mart on Self Employment and Small Establishments in the United States." West Virginia University. Retrieved August 4, 2006. SSRN 986362
  141. ^ Clark, Sarah. (November 4, 2005). "Wal-Mart Saves Working Families $2,329 Per Year; Has Net Positive Impact on Real Wages and Job Creation". Wal-Mart. Retrieved August 4, 2006.[dead link]
  142. ^ Business Planning Solutions Global Insight Advisory Services Division. (November 2, 2005). "The Economic Impact of Wal-Mart." Global Insight. Retrieved August 17, 2006.
  143. ^ Clark, Robert E. (June 26, 2007). "The Wal-Mart effect: Its Chinese imports have displaced nearly 200,000 U.S. jobs Retrieved August 2, 2008
  144. ^ Basker, Emek. (2002). "Job Creation or Destruction? Labor-Market Effects of Wal-Mart Expansion". University of Missouri. Retrieved August 4, 2006.
  145. ^ Siegel, Jeremy J.. "In praise of Wal-Mart". MSN Money. Retrieved 2009-03-12.
  146. ^ Mallaby, Sebastian. (November 28, 2005). "Progressive Wal-Mart. Really". The Washington Post. Retrieved August 4, 2006.
  147. ^ Hausman, Jerry; Ephraim Leibtag. (October 2005). "Consumer Benefits from Increased Competition in Shopping Outlets: Measuring the Effect of Wal-Mart". MIT/United States Department of Agriculture. Retrieved August 4, 2006.
  148. ^ a b Goetz, Stephan J.; Hema Swaminathan. (October 18, 2004). "Wal-Mart and County-Wide Poverty". Pennsylvania State University. Retrieved August 4, 2006.
  149. ^ Patel, R., (September 18, 2007). "Food Glorious Food". Radio National. Retrieved April 10, 2009.
  150. ^ Sellers, Jeff M (April 22, 2005). "Women Against Wal-Mart". Christianity Today. Retrieved July 31, 2006.
  151. ^ Sellers, Jeff M (April 22, 2005). "Deliver Us from Wal-Mart?". Christianity Today. Retrieved July 31, 2006.
  152. ^ Kabel, Marcus (July 18, 2006). "Wal-Mart, Critics Slam Each Other on Web". The Washington Post. Retrieved July 31, 2006.
  153. ^ Copeland, Larry (March 13, 2006). "Wal-Mart's Hired Advocate Takes Flak". USA Today. Retrieved July 31, 2006.
  154. ^ Rodino Associates. "Final Report on Research for Big Box Retail/Superstore Ordinance[dead link]." Los Angeles City Council. October 28, 2003. Retrieved July 31, 2006.
  155. ^ Smith, Hedrick."Who Calls the Shots in the Global Economy?" Public Broadcasting Service. Retrieved July 31, 2006.
  156. ^ "UFCW Launches New Campaign To "Wake Up Wal-Mart"". United Food and Commercial Workers. April 5, 2005. Retrieved January 13, 2011.
  157. ^ "Group Targest Wal-Mart". The Spokesman Review. April 21, 2005. Retrieved January 13, 2011.[dead link]
  158. ^ " (official public relations website)." Wal-Mart. Retrieved August 1, 2006.
  159. ^ Barnaro, Michael (November 1, 2005). "A New Weapon for Wal-Mart: A War Room". The New York Times. Retrieved August 1, 2006.
  160. ^ Barbaro, Michael (March 7, 2006). "Wal-Mart Enlists Bloggers in P.R. Campaign". The New York Times. Retrieved August 1, 2006.
  161. ^ Zimmerman, Ann (June 7, 2010). "Rival Chains Secretly Fund Opposition to Wal-Mart". The Wall Street Journal. Retrieved June 9, 2010.
  162. ^ Norwegian Ministry of Finance (June 6, 2006). "Two companies – Wal-Mart and Freeport – are being excluded from the Norwegian Government Pension Fund – Global's investment universe".
  163. ^ a b The Ethical Council of the Government Pension Fund of Norway (November 15, 2005). "Recommendation of November 15, 2005". The Ministry of Finance.
  164. ^ Vivienne Walt, Fortune (July 24, 2006). "Norway to Wal-Mart: We don't want your shares". CNN.
  165. ^ Steven Greenhouse (January 18, 2004). "Workers Assail Night Lock-Ins By Wal-Mart". The New York Times.
  166. ^ "2004 Report on Standards for Suppliers". Wal-Mart Stores, Inc.
  167. ^ a b "Store Wars: When Wal-Mart Comes to Town." Public Broadcasting Service. Retrieved February 24, 2007.
  168. ^ Wal-Mart Stores, Inc. – Benefits
  169. ^ Nordlinger, Jay. (August 5, 2004). "The New Colossus." National Review. Retrieved November 20, 2006.
  170. ^ Penn & Teller: Bullshit, Season 5, Episode 2.
  171. ^ Lichtenstein, Nelson. 2006. Wal-Mart: The Face of Twenty-First Century Capitalism. New Press.
  172. ^ a b Zimmerman, Ann; Maher, Kris (August 1, 2008). "Wal-Mart Warns of Democratic Win". The Wall Street Journal: p. A1
  173. ^ Wal-Mart Put Chill on Expression in Workplace, Says Professor Newswise. Retrieved August 17, 2008.
  174. ^ Naughton, Keith (October 30, 2006). "The Great Wal-Mart of China". Newsweek. Retrieved November 1, 2007.
  175. ^ "Financial Content, Posted on November 17, 2011".
  176. ^ "The Press-Enterprise PE.Com Published: October 13, 2011".
  177. ^ "Warehouse Workers United January 18, 2012 website".
  178. ^ "Wal-Mart Faces Class-Action Lawsuit". Newsmax. February 6, 2007. Retrieved June 21, 2011.
  179. ^ "Wal-Mart Stores, Inc., Petitioner v. Betty Dukes et al". United States Supreme Court. June 20, 2011. Retrieved June 21, 2011.
  180. ^ Lennard, Natasha (June 20, 2011). "The Supreme Court sides with Wal-Mart". Salon. Retrieved June 21, 2011.
  181. ^ Clifford, Stephanie (June 20, 2011). "Despite Setback, Plaintiffs to Pursue Wal-Mart Cases". The New York Times. Retrieved June 21, 2011.
  182. ^ Conlin, Michelle (July 16, 2001). "Is Wal-Mart Hostile to Women?". BusinessWeek. Retrieved October 1, 2006.
  183. ^ a b c Zellner, Wendy (March 3, 2003). "No Way to Treat a Lady?". BusinessWeek. Retrieved October 1, 2006.
  184. ^ Malanga, Steven. "The Tort Plague Hits Wal-Mart". City Journal. Retrieved 2009-02-23.
  185. ^ Moller, Mark (Summer 2007). "The Anti- Constitutional Culture of Class Action Law" (PDF). Regulation. pp. 50–58. Retrieved 2009-03-12.
  186. ^ Dreiband, Eric S. (January 7, 2006). "Willie Sutton Was a Piker". The Wall Street Journal. Retrieved 2009-03-12.
  187. ^ "Wal-Mart Stores, Inc. Recognized As Top Company For Executive Women by the National Association For Female Executives" (Press release). Wal-Mart Stores, Inc.. April 3, 2007.
  188. ^ Kershaw, Sarah (July 2, 2003). "Wal-Mart Sets a New Policy That Protects Gay Workers". The New York Times. Retrieved October 1, 2006.
  189. ^ "HRC Applauds Wal-Mart's Inclusive Family Policy" (press release). Human Rights Campaign. January 27, 2005. Retrieved October 1, 2006.
  190. ^ "Corporate Equality Index". Human Rights Campaign. 2006. Retrieved November 2, 2006.
  191. ^ DiGuglielmo, Joey (November 28, 2007). "Wal-Mart Sets Record with HRC Ratings Plunge". Washington Blade. Retrieved December 3, 2007.[dead link]
  192. ^ Kabel, Marcus (January 5, 2006). "Wal-Mart CEO Expects Record Profits". Deseret News. Retrieved December 1, 2006.[dead link]

Further reading

  • Charles Fishman. The Wal-Mart Effect: How the World's Most Powerful Company Really Works—and How It's Transforming the American Economy (2006).ISBN 978-1594200762.
  • Paul Ingram, Lori Qingyuan Yue, and Hayagreeva Rao. "Trouble in Store: Probes, Protests, and Store Openings by Wal‐Mart, 1998–2007," American Journal of Sociology July 2010, Vol. 116, No. 1: pp 53–92. doi:10.1086/653596.
  • Nelson Lichtenstein. The Retail Revolution: How Wal-Mart Created a Brave New World of Business (2009). ISBN 978-0-8050-7966-1.
  • Sandra Stringer Vance and Roy V. Scott. Wal-Mart: A History of Sam Walton's Retail Phenomenon (Twayne's Evolution of Modern Business Series) (1997), academic study. ISBN 978-0-8057-9832-6.

External links


  1. new generic drug for viagra

    Thanks for this amazing and useful information. Hope you’ll like mine… is an online pharmacy store that sells the best Sildenafil Citrate – Generic Viagra Generic ED medication to men suffering with erectile dysfunction, Impotency problem and premature ejaculation. We provide medicines at best reasonable price in USA. We have built up ourselves as a leader in the category of online pharmacies since the inception our operation. We have taken continuous efforts towards providing quality and high standard products to our customers by confirming to the standards of manufacturing and quality control. Before providing the medications we rectify the medicines through testing and checking of the products, the medications sold by us are approved by the FDA (Food and Drug Administration) due to the existence of the active ingredients in the product.

  2. Best content & valuable as well. Thanks for sharing this content.
    Approved Auditor in DAFZA
    Approved Auditor in RAKEZ
    Approved Auditor in JAFZA
    i heard about this blog & get actually whatever i was finding. Nice post love to read this blog
    Approved Auditor in DMCC

  3. This post is very informative about to this topic. I hope Author will be sharing more information about this topic. My blog is all about that Best_Hair_Patch & Hair_Fall_Treatment. To Book Your Service ��+91-9873152223, +91-9250504810 and be our Happy Client. Click Here for Contact us at Whatsapp no: Address - Vardhman Diamond Plaza, First Floor D.B. Gupta Road Pahar Ganj New Delhi – 110055.


Related Posts Plugin for WordPress, Blogger...


Website counter


Blog Archive