Ecommerce news India - Walmart India part of Walmart Inc, the world's largest retailer, has fired 56 of its Indian executives as part of the restructuring process in the country, three informed sources told Reuters.
This measure underscores the difficulties Walmart India has faced in expanding its wholesale business in India. Headquartered in Bentonville, Arkansas, the company currently operates 28 wholesale stores selling products to small shopkeepers rather than retail consumers.
Krish Iyer, president, and CEO of Walmart India said in a statement that eight of the 56 executives were in "senior management" positions and the rest are of the middle or lower management.
Walmart India dismissed about 56 of executives, with a focus on e-commerce; a move to delay the opening of new wholesale stores.
"We are also looking for ways to work more efficiently, which requires us to review our corporate structure to ensure we are properly organized," Iyer said, adding that fired executives had been offered improved compensation benefits.
Two of the sources said that the layoffs mainly affected the company's real estate executives because the growth in the wholesale model was not very strong.
Reuters reported layoffs on Monday, citing three people with first-hand knowledge of the matter, adding that this measure has mainly affected executives at Walmart Real Estate, which is responsible for expanding warehouses, as the wholesale business model has not achieved the expected growth.
A source, who asked not to be named because the decision is not public, said, "This happened because the modern approach is shifting towards e-commerce instead of physical stores."
Iyer, however, told that Walmart, as always will be committed to developing physical stores as well.
"We recently made significant investments to better serve our members and we will continue to do so. This includes investments in our physical stores, as well as e-commerce."
Walmart has made bold bets in the e-commerce sector in India. In 2018, Walmart paid $ 16 billion to buy a majority stake in the e-commerce giant Flipkart, the largest global acquisition. Walmart made it big in the ecommerce news in India.
The second source added that although Walmart India may slow the pace of opening new wholesale stores, attention will increasingly focus on increasing sales through e-commerce between businesses and retailers.
Two sources said, some executives were fired last week, and more may be dismissed on Monday.
In a statement to The Economic Times, which first published the news, Walmart India said it was always looking for ways to work more effectively and that "this requires us to review our corporate structure to ensure that we are organized in the best possible way meeting the needs of our members.
One source said that Walmart India has about 600 employees in its head office in India out of a total of about 5,300 employees nationwide.
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