Walmart announces downsizing in India; fires 56 executives
- Walmart fires 56 executives as part of a corporate restructuring in India.
- Walmart acquired India's Flipkart for $16 billion in 2018 that marked its largest global acquisition.
- Walmart may focus more on building its e-commerce unit in India in the upcoming months.
- Walmart has gained around 20% as compared to the opening level in 2019.
The world’s leading retailer, Walmart Inc. had previously announced plans of corporate restructuring in India. In the implementation phase, the plan recently saw 56 of the retailer’s executives ousted in India.
The downsizing, as per the Arkansas based retailer, is likely to help it overcome the troubles it had previously faced while expanding the wholesale business with the country. As of now, Walmart has 28 stores in India that are in business with other small-scale shopkeepers and not with the retail consumers.
Majority Of The Fired Executives Belonged To Walmart India’s Real Estate Division
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As per the sources, the majority of executives which have been let go belong to the real estate department of Walmart India that is primarily involved in planning countrywide expansions. It was further added that the retailer was pushed into the decision as it failed to hit the expected growth targets in India.
According to CEO Krish Iyer, eight of the fired executives were from senior management while the rest of them were managers at the middle or lower levels. He also highlighted that the company is currently seeking ways to promote operational efficiency for which evaluation of the corporate structure and subsequent downsizing was deemed necessary. Iyer also informed that the now-former executives were given improved severance benefits as well.
The Arkansas-based retailer is known to make sizeable investments in India’s e-commerce sectors. In 2018, it announced its largest global acquisition of Flipkart for $16 billion. Flipkart is a top Indian online marketplace. As per the company representative, Walmart’s rising interest in India stems from a sharply increasing trend of online shopping in the Asian country.
Walmart May Increase Focus On Building Its E-Commerce Unit
In light of the changing trend to online shopping, Walmart is expected to halt launching new brick and mortar stores in India and focus more on e-commerce while striking deals with businesses, as highlighted by a close source. The CEO, on the other hand, reiterated that the retailer is committed to opening new wholesale shops in India while expanding the e-commerce unit as well.
Statistics also revealed that the company has an estimated labor force of 600 people working in the head office in India while a total of 5,300 people employed nationally.
Walmart is currently exchanging hands at around $116 in the stock market that marks an around 20% growth as compared to the opening level of 2019. Share prices were seen trading at a record high of around $122 towards the end of the last year.