Wal-Mart Private Label Launched in India

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Sept. 11- Bharti Retail has launched eight Wal-Mart private labels, including two of its largest, the ‘Great Value’ line of food and ‘George’ line of clothing, in its supermarket chain Easyday reports The Economic Times.

The private store brands offer international design and packaging for the more discerning buyer at a lower cost. This is the first time that a Wal-Mart private label has been launched in stores not owned by the retail giant that grosses US$400 billion annually through 7,800 stores in 16 countries.

FDI in the retail sector is still restricted under Indian laws and FDI into multi-brand retail is not allowed. For single-brand retail outlets 51 percent FDI is allowed. This is why Wal-Mart entered the Indian market only for wholesale trading known as “Cash and Carry” where currently 100 percent FDI through the automatic route is allowed.

Bharti is a franchisee of Wal-Mart and opened its first supermarket in India last year and now has 25 outlets in the country. Bharti Retail gets 15 to 20 percent of sales from private labels and hopes to increase this amount to 30 percent. Introduction of more private labels may help Bharti follow its partner Wal-Mart’s everyday low price philosophy. Private labels help boost sales and margins for retailers.

“The era of private label in India has just begun and Wal-Mart’s move to introduce private labels in India could take it much ahead of its rivals and make its brands a household name,” Harminder Sahni, MD of retail consultant Wazir, told The Economic Times.