Walmart Diversifies Supply Chain by Sourcing More Goods from India

As part of its efforts to reduce costs and diversify its supply chain, Walmart is importing more items into the United States from India and decreasing its reliance on China, according to data seen by Reuters.

Between January and August of this year, the largest retailer in the world transported 25% of its imports into the United States from India, according to bill of lading data that data firm Import Yeti provided. In contrast, that was only 2% in 2018.

The same data indicates that over the same period, China accounted for just 60% of its sales, down from 80% in 2018. Indeed, China continues to be Walmart's top import destination.

This change demonstrates how big American corporations are purchasing more from India, Thailand, and Vietnam as a result of growing import costs from China and growing political tensions between Washington and Beijing.

Walmart's Executive Vice President of Sourcing, Andrea Albright, emphasized the company's pursuit of the best prices during an interview. Albright highlighted the necessity for supply chain resilience, citing the ongoing management of factors such as hurricanes, earthquakes, and shortages in raw materials.

Walmart stated in a statement that while the bill of lading data provided a partial view of what it sourced, increasing redundancy "does not necessarily mean" that the company was lowering its reliance on any particular market for sourcing. "We're a growth business and are working to source more manufacturing capacity," Walmart stated.

According to Albright, Walmart's efforts to increase its production capacity have seen India emerge as a crucial component.

Following its acquisition of a 77% share in Indian e-commerce company Flipkart in 2018, Walmart has been rapidly expanding its operations in India. It promised, two years later, to bring in $10 billion worth of commodities from India annually by 2027. According to Albright, it is still on course to meet that goal. At the moment, it imports commodities from India valued at about $3 billion annually.

Walmart's Expansion into Indian Markets: Imports, Market Trends, and Strategic Alliances

Walmart is bringing products into the United States from India, including gadgets, toys, bicycles, and medications, according to Albright. She also mentioned that pasta, dry cereals, and packaged food are popular imports from India.

India's stock market has surged to all-time highs this year, and analysts believe that this nation is most suited to surpass China in large-scale, low-cost manufacturing.

Walmart was drawn to the company by its quickly expanding staff and cutting-edge technology, according to Albright. Conversely, China said last year that its population has decreased for the first time in 60 years.

In Bangalore, Walmart began its sourcing activities in 2002. Currently, the corporation employs over 100,000 individuals in the nation, including temporary workers, dispersed across many locations under its sourcing operations, Flipkart Group, PhonePe, and Walmart Global Tech India unit.

Indian Prime Minister Narendra Modi and Walmart CEO Doug McMillon met in May of this year; Modi described the discussion as "a fruitful one."