Bharti looks to Future

GROCERS often do not travel well. A sally into America in 2007 by Tesco, a then imperious but now troubled British retailer, ended badly. Before that, Walmart had failed in Germany. In India the big international chains have had trouble even crossing the border. A change in the rules in 2012 allowed foreign firms a stake of up to 51% in supermarket ventures. But the ensuing political rumpus led to Indian states being allowed to set tougher rules on their turf. Carrefour of France, having opened only five wholesale outlets, has since decided to leave India altogether. Walmart has withdrawn from a wholesaling joint venture with Bharti Retail, part of a conglomerate whose flagship firm is India’s leading mobile-phone operator—though it remains in the cash-and-carry business.

In a less frosty climate, Walmart’s tie-up with Bharti Retail might have evolved into a full-blown retailing alliance. Instead the Indian firm, which has yet to make a profit, has had to settle for a local partner. On May 4th it said it would join up with Kishore Biyani, one of India’s retail pioneers. Bharti’s 200-plus stores, most of them small, will be folded into Future Retail, one of Mr Biyani’s three listed enterprises. Future’s 370 stores have a higher average floor space and a much greater combined turnover. Bharti’s hypermarkets may eventually trade under Future’s Big Bazaar banner, but its...

from The Economist: Business http://ift.tt/1ESApgr