Global Retailers Riding High on India; Tesco uses India as a Global Solutions Hub

India has for long been known as a key sourcing hub for highly skilled and talented workforce, especially in the area of technology. Taking this forward, Tesco, the world’s third largest retailer, with a presence across 13 countries and revenues in excess of USD 100 billion has been operating its global service centre from Bangalore. Known as Tesco HSC (Hindustan Service Centre), it started operations in May 2004 and at last count, employs more than 6000 people and provides key business services for Tesco operations globally.

The centre is a key hub for the development of mobile apps for various devices for e-tail customers worldwide, as well as voice applications and other technology driven products and innovations that drive the global retail business for Tesco. Speaking to Economic Times earlier, Sandeep Dhar, CEO of Tesco HSC, had said, “There are a variety of mobile applications being developed from Tesco HSC. Tesco has launched mobile grocery applications on the Android, iPhone, iPad, Nokia and Windows 7 platforms to enable the customer to shop while being mobile. These apps are engineered and maintained at the Tesco HSC.” Sandep has over 20 years of industry experience and was previously Managing Director at Sapient India.

In addition to the HSC, Tesco sources over £270 million worth of products from India each year and has sourcing offices in Bangalore and Delhi. The company has also entered into a separate franchise agreement with Trent, a retail arm of the Tata Group, which gives Trent’s hypermarket chain, Star Bazaar, exclusive access to Tesco’s retail expertise. The company supplies over 70% of the products to Star Bazaar.

While a majority of global retailers wait for the Indian retail market to open its doors, global giants such as Tesco, Carrefour, Walmart etc. have already started establishing their presence in the country through a variety of initiatives.

While UK-based Tesco operates HSC to services its global clientele, French retailer Carrefour operates cash-and-carry stores for retailers from Delhi (launched in December 2010)and Jaipur (Launched in November 2011), German giant Metro operates stores in India since 2003 across Kolkata, Delhi, Bangalore, Mumbai and 3 other cities, while US-based Walmart had been in the news recently for increasing its staff at the Bangalore campus, in addition to the much publicised venture with Bharati Retail, the retail arm of Telecom giant Bharati Airtel.

The above table provides information on India operations of key global retailers.

Global retail giants have been using India as a sourcing hub for resources and technology for the past 10 years and are now waiting for the Government of India to give them a free-hand to offer their products and services to the highly-lucrative and rapidly-expanding B2C market.  The online retail market is also expanding by the day with more and more consumers getting added in Tier-II and III cities, through the use of technology, purchasing products online and over the phone.

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