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Wal-Mart eyes small India shops

– Wal-Mart Stores has opened an e-commerce website to supply goods to mom-and-pop merchants in India as the world’s largest retailer seeks to dominate a market it estimates will be valued at $50 billion by 2020.

Wal-Mart is counting on its online operations to help fuel sales as it grapples with a slowdown both at home and abroad. The Indian website is only for existing users of its members-only cash-and-carry stores and may help draw orders from small businesses more than 12 miles from outlets and that aren’t serviced by sales representatives, said the company’s chief executive for India Krish Iyer.

“The mandate from Wal-Mart for me is to focus on the cash- and-carry business.” Iyer said in an interview in New Delhi June 13. “We are into cash-and-carry for the long-haul and the prize is big.”

The retailer this month promoted Latin America executive Fernando Madeira to chief executive officer of Walmart.com, the e-commerce division that’s leading the company’s battle against Amazon.com. Online revenue accounts for less than 3 percent of the Bentonville, Arkansas-based group’s total sales.

Unlike the Sam’s club and other member-based store formats, India’s cash-and-carry services are only for mom-and-pop shops and other traders who need government tax documents to become members. Ordinary shoppers are not allowed to enter the stores or shop on this new website.

The web-based ordering platform is being piloted in two cities – Hyderabad in southern India and Lucknow in the north – and will be rolled out across all its stores by January 2015, Iyer said. The company’s sales reps will train small business customers to use the website, Iyer said.

“The small mom-and-pop shops is where the challenge lies in terms of converting them into e-shoppers,” said Iyer, who was appointed chief executive in January. “A deliberate effort is required to educate them in the whole process,”

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