New Market Opportunities

Companys Mission"To give ordinary folk the chance to buy the same thing as rich people."

What it takes to be a WAL-MARTy The Winning strategy- selling branded products at low cost.

y Non dependence on any single vendor.

y Reliability on its own distribution system.

Bharti Wal-Mart Deal

Political and Legal Factorsy Under India's tight foreign investment rules, no overseas chains

are permitted in the retail sector.y Organizations may create a monopoly in the market. y Left leaning parties and communist parties opposing because it

may kill unorganized retail sector.y The country's 15-million "mom-and-pop" outlets out of

business.

Political and Legal FactorsFDI in retail sector in India with the following reforms has the potential of creating 8 million new jobs.y Removal of cap on FDI, y Flexible labor laws, y Product market liberalization, y Reforms in the urban land ceiling and tenancy laws etc.

Economical Factorsy Interest rates. y High level of inflation y Long-term prospects for the sustained economy growth

encouraging (GDP)y Exchange rates affect global sourcing and pricing policies on

day to day basis.y Accelerating the investment in infrastructure but no progress.

Socio-Cultural Factorsy Language and Cultural factors is a barrier to globalization. y Distribution of income Middle class y Consumerism and changes in Indian Culture. y Change in Lifestyle.

Technological Factorsy New discoveries and innovations like software's for retail

houses.y Speed of technology transfer inventory management y Use of Internet and E-commerce. y Online shopping.

Market Analysis

The competitionM A R K E T P L A Y E R S

Key CompetitorsFuture groups Retail Venture: y Big Bazaar y Food Bazaar y Pantaloonsy Reliance Fresh y Tata s Retail venture: Star India Bazaar y Aditya Birla Group-More

Consumer Profile

The Indian consumption patterns are slowly converging with global norms. The Indian consumer is now spending more. One of the key reasons for the increased consumption is the impressive growth of the middle class. This presents the largest potential market in the world. The number of lower middle income group in rural areas is almost double as compared to the urban areas, having a large consuming class with 41% of the Indian middle class and 58% of the total disposable income.

Consumer Behaviour

Availability of lifestyle spending options is increasing for Indian consumers and that inducing higher spends on status acquisition. Indian consumer buying behavior to a large extent has a western influence. Foreign brands have gained wide consumer acceptance in India and they are much more open for experimentation. The emergence of a larger middle and upper middle classes and the substantial increase in their disposable income has changed the nature of shopping in India from need based to lifestyle dictated.

Strengthsy Wal-Mart is a largest corporation status and recognition. y People are key to success- suppliers. y Wal-Mart has grown and has experienced global expansion -

purchase of the UK based retailer ASDA.y Wal-Mart's distribution centre and logistics capabilities are key

strengths adding value to its entire system.

Strengthsy Wal-Mart's cross-docking and effective inventory management

gives 3% cost advantage to sustain its Every Day Low Price Strategy.y Low price & customer-oriented y Strong supply chain

Weaknessesy Wal-Mart still to develop expertise in international marketing y Not fulfilling expansion plans Germany & South Korea y Despite its IT advantages, it leaves it weak in some areas due to the

huge span of control.y It sells products across many sectors (such as clothing, food, or

stationary), it may not have the flexibility of some of its more focused competitors.

Opportunitiesy Growing middle class consumers in emerging markets like China and

India gives opportunity for Global expansion.y Growth of E-Commerce enables new business channels. y To take over, merge with, or form strategic alliances with other global

retailers, focusing on specific emerging markets.y y y

Build its own brand Put efforts on social welfare - better image New locations and store types

Threatsy Local and global competitors. y Being a global retailer means that you are exposed to political

problems in the countries that you operate in.y Intense price competition is a threat. y Growing trade blocks and zoning regulations hamper Wal-

Mart's expansion plans.

Michel Porters 5 Force Model

Porters 5 Force ModelBargaining Power Of Suppliersy

Suppliers would loose power over pricing and other terms due to Wal-Marts size. Wal-Mart may become key customer to most of suppliers and would totally depend on Wal-Mart for business. Wal-Mart engages in aggressive selling tactics.

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y

Porters 5 Force ModelBargaining Power of Buyersy

Proactive Customer Service Only retail store to provide at very less and competitive prices Best Pricing would isolate Wal-Mart from competition. Thus leaving customers with limited choice

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y

Porters 5 Force ModelThreat of Entryy

High Investment Costs Extensive investment in Information Technology Extensive distribution network Scale and scope of operations is high Regulatory concerns

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y

Porters 5 Force ModelThreat of Substitutesy

Department stores charge high Wal-Mart has all types of formats serving all types of customers Strong presence of National & International Chains Schemes run like Best Pricing, Low Pricing etc Competition in India by other players will help Wal-Mart maintain better pricing power improving profitability.

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Marketing &sales strategiesy Wal-Mart maintains a simple and effective marketing strategy. y Does not believe in Advertising to push the products. y Every Day Low Price Strategy. y Wal-Mart has taken an innovative

approach to in-store advertising.y Big Box Concept

Global Expansion Strategies Of Wal-Marty RAISE EXPECTATIONS: Reshape company culture y RAISE STANDARDS: Measure progress towards sustainability y RAISE AWARENESS: Uncover new business opportunities y RAISE PROFITS: Inspire process and product innovation

Opportunities for Wal-Marty Economic Growth increase in GDP of India. y Increasing Purchasing power of Indians. y Young population - spending power y Rapid Urbanization y Growing middle-class population y Brand Consciousness y Consumerism y Growing advertising and promotional activities results into

growth in Consumption patterns.

Opportunities for Indiay Modernization of Retail Industry. y World-class shopping experience y International standards y Employment to millions of Indians y Elimination of middle-men and agents, thus protecting Indian

Farmers from exploitation.

Conclusiony India can be the worlds breadbasket. Its failing to do so because most

of its farms are small, inefficiently run, and dont use modern technology.y Wal-Mart can change the scenario. y Once allowed to invest, they will have more incentives to buy

domestically and to build productivity-enhancing infrastructure.y Boost the GDP in the Agricultural sector. y Accelerate the infrastructure.

Conclusiony Retailing will generate the demand for processed food products

and stimulate investment and technology transfer in the food processing industry.y To accelerate the economic growth we need the Private

investment not only in financial sector but also in agricultural sector.y Increase Indian Manufacturing sector because China

manufactures for Wal-Mart.

ConclusionOne cannot escape the much larger debateCorporate interest vs. Interests of small producers, Free trade vs. Protectionism.

India is not America.y "India is not a homogenous

market, so ours is not a cookiecutter approach from the U.S.," says Raj Jain, president of WalMart India.y India is one country, but a

hundred different markets.y Geographical challenges

WILL WAL-MART SUCCEED IN INDIA ?It will succeed because It has the best know how to provide the right set products to the

right set of customers. Customers are also hungry for new ways of shopping. Wal-Mart Company has tremendous sourcing efficiencies

which will bring economies of scale from day one. Shopping will become to order Online.

Thank youDevelop your 10 Ps of Big Bazaar or Shoppers's Stop