Walmart set to launch B2B platform in India in July

Walmart Stores Inc, the world's largest retailer, will launch its business-to-business e-commerce platform in Lucknow and Hyderabad in the first week of July, its India head said on Friday.

The American retail giant has 20 wholesale outlets in India, including in Lucknow and Hyderabad, which will support its e-commerce service in the business-to-consumer space as well, its India chief executive Krish Iyer said.

Walmart wants to roll out its physical retail stores but does not consider the current FDI rules favourable. So, for now, it is focused on its cash-and-carry business and exploring opportunities in the e-commerce space.

''We will definitely look at getting into the consumer space via the e-commerce route if foreign direct investment rules are tweaked by the new government,'' said Krish Iyer, president and CEO of Walmart in India.

''We have announced our pilot to be launched in Lucknow and Hyderabad for B2B ecommerce. It is important to understand how re-sellers and our member base respond to placing orders on the Net. If that really works well, in the next six months we will roll it out in the rest of the stores,'' Iyer said.

Walmart had initially entered India in partnership with the Bharti Group to start a cash-and-carry business in India, but had to abandon its partnership over some irregularities. Walmart, which opened its 20th India store in end-2012, will not have a new cash-and-carry or wholesale store in India till the last quarter of 2015.

The company froze expansion plans due to internal investigations in the US into possible violations of the Foreign Corrupt Practices Act and a subsequent break-up with Indian partner Bharti Enterprises. The investigations are still underway.

Also, with the current Bharatiya Janata Party government also in principle opposed to FDI in multi-brand retail, Walmart considers its e-commerce entry and a cash-and-carry format ideal for now.

Walmart already operates inventory-based e-commerce businesses in Brazil, China, Canada and Japan.

India currently prohibits global online retailers from selling goods directly to customers but allows them to wholly own a B2B business, where third-party suppliers can use their platform. Both Amazon and eBay use such a platform to operate in the country.

The new government under Prime minister Narendra Modi is reviewing the FDI rules governing e-commerce sector and could allow FDI in all types of online platforms.