Walmart is likely to stay away from investing in food-only ventures after acquisition from Flipkart. The company will only hold stock and sell groceries online through third-party retailers.
The report further says that the US-based company does not want to bear the burden of the conditions that come with foreign direct investment which is up to 100 percent in food-only ventures says the report. “It doesn’t make sense to sell only food either through brick-and-mortar or through online,” said a source. “With all those riders, it is even harder to do it.”
Walmart is taking a complete opposite approach as compared to its direct competition, Amazon as the latter has invested $500 million in food retail in India along with adding 15 warehouses to expand the grocery delivery business.
However, Devangshu Dutta, chief executive officer of retail consultant Third Eyesight sees it in a different light as he told thata company like Walmart has come to India for a long term and may not rush into making hasty decisions. “They are looking at India as a long-term game — if it may not happen now, it will happen two years down the line when the regulations become friendly,” he saigs. “If you are in for the long haul, you are not in a rush as the window of opportunity is not closing.”