New Delhi: Walmart Inc. has fired 56 employees in India as it restructures its business in the country but has no plans to shut down physical operations, the company said in a statement refuting a report in the local media.
The world’s largest retailer “remains committed” to growing its wholesale retail business in India, Walmart India’s Chief Executive Officer Krish Iyer said in an emailed statement Monday.
The job cuts included eight senior executives, he said.
Walmart is “looking for ways to operate more efficiently, which requires us to review our corporate structure,” Iyer said. “We have recently made significant investments to serve our members better and will continue to do so.”
Local newspaper The Economic Times had said in a report on Monday that Walmart was planning further job cuts in April as part of an overall plan to shut down its physical presence in the country after struggling to turn a profit. The local unit of the Bentonville, Arkansas-based company called the report “baseless and incorrect.” Walmart India’s sales rose 22% last year, it said, but did not specify if operations are loss-making.
The lay offs make up 1% of Walmart’s overall workforce in India and new stores will continue to be opened, according to the people familiar with the matter, who asked not to be identified because they are not authorised to speak publicly. The dismissals were due to a greater incorporation of technology into the US retailer’s local operations, the people said.
Amazon, Walmart Face the Ire of 70 Million India Shopkeepers
The job cuts come as competition grows fiercer in the local retail market. Amazon.com Inc. is stepping up investment, and Asia’s richest man, Mukesh Ambani, is preparing to roll out his e-commerce venture.
Global retailers like Walmart have been stymied by regulations in India that are designed to protect local mom-and-pop stores — known as kiranas — from foreign competition. Prevented from selling directly to consumers, the Bentonville, Arkansas-based company has focused on building a wholesale business that supplies local store-owners, and has also pivoted to e-commerce by acquiring Flipkart Online Services Pvt. for $16 billion in 2018.
Political pressure is now growing for stricter regulation of foreign-owned e-commerce platforms as well, while a broad consumption slowdown has added to retailers’ woes.