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Is this the end of Walmart in India; worst economic conditions led to sacking

The sacking mostly affected employees in company's real estate as this division has been badly hit by the economic slow down in the country.

Saima Siddiqui

Saima SiddiquiBy Saima Siddiqui

Published on 13 Jan 2020 10:08 AM GMT

Is this the end of Walmart in India; worst economic conditions led to sacking
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New Delhi: One of the world's major retail stores, Walmart has sacked 56 of its executives, out of which 8 are from senior management, in India. The move has been taken as the company wants to restructures business in the country.

The sacking mostly affected employees in company's real estate as this division has been badly hit by the economic slow down in the country.

The development came 18 months after the 'Walmart' came out as the largest shareholder in the Indian e-commerce firm by acquiring a majority stake in country's online marketplace Flip Flipkart in its biggest global acquisition that is $16-billion deal, in 2018.

"It's happening because focus is shifting to e-commerce rather than physical (stores)," said a source.

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As per the president and CEO of the US-based retail major's India unit, Krish Iyer, Walmart is exploring ways to operate more efficiently in the country, which requires it to review its corporate structure "to ensure that we are organized in the right way."

The Bentonville, Ark. based firm currently employees 600 staff in its India head office out of a total of around 5,300 nationally and operates 28 wholesale stores where it sells goods to small vendors or Shopkeepers and not to retail consumers.

According to a report, the company will lay off over 100 senior executives from its Sourcing, Agri Business and FMCG division's Vice President, working at Gurugram headquarter.

The company took a big decision

Earlier, the Indian hotel chain 'OYO' rooms also had sacked its employees. According to a report, Walmart does not see any future in cash-and-carry businesses in India and this retrenchment may be the beginning of selling this business or merging its operations with the back-end of Flipkart. The company is also preparing to close the fulfillment Center in Mumbai. If the reports are to be believed the Walmart will not open more stores in India.

There will be retrenchment in April

Walmart company is not making any profit in India. As per company's top officials this is the first round of retrenchment and it is expected to happen again by April.

It is to be mentioned that the loss-making company 'Tata Group' had negotiated to buy Walmart's wholesale business, but did not find the deal profitable. Walmart's Best Price Stores had registered a loss of Rs 2,180.8 crore as of March 2019.

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Saima Siddiqui

Saima Siddiqui

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