But a FreshDirect senior vice president said the upgrade would not affect the equipment that has led to occasional complaints about the company — a smaller motor that runs refrigeration equipment to keep the food fresh. The new equipment will shut off only the engine that powers the drive train. The two operate separately.

The state attorney general, Andrew M. Cuomo, announced Friday that his office and FreshDirect, based in Long Island City, Queens, had reached an agreement on installing the shutoff equipment after an investigation into consumer complaints that FreshDirect trucks were violating anti-idling laws.

A statement from Mr. Cuomo said the investigation documented at least 30 cases of illegal idling by FreshDirect trucks. Under state law, trucks and buses cannot idle for more than five minutes at a time. New York City limits idling time to three minutes, and in areas near schools, it is no more than 60 seconds.

FreshDirect, which averages 7,000 deliveries a day, has agreed to pay a $50,000 penalty for violating state and city anti-idling laws, the statement said. It said the penalty had been $120,000, but $70,000 had been suspended contingent on the company’s compliance.

Mr. Cuomo said that besides affecting public health and the environment, idling wastes fuel: an average of 30,000 gallons of gasoline and 20,000 gallons of diesel fuel in the city every day.

Jim Moore, FreshDirect’s senior vice president for business affairs, said the company has had experience with engine-control technology. It has the equipment on 20 to 25 trucks, the newest in its fleet. The engine turns off if the vehicle remains in park for more than three minutes.

The company promised that any new trucks would come with the equipment.

Mr. Moore said the company had received complaints about idling since its trucks hit the streets in 2002. He said the company had looked into those complaints and concluded that they stemmed from noise made by the refrigeration engines. Those are not covered by the agreement with Mr. Cuomo.

But Indian consumers won’t be able to partake of Wal-Mart’s everyday low prices. India’s restrictive commercial laws prohibit most foreign companies from setting up shop to compete with domestic retailers. So Wal-Mart’s debut outlet, which will open in the city of Amritsar in northern India later this month, is a wholesale-only operation that will sell mainly to vegetable vendors, hospitals, hotels, restaurants and other companies. The Amritsar outlet won’t even carry the familiar Wal-Mart brand. To deflect the attention of politicians and activists who oppose the entry of foreign multi-brand retailers, the Little Rock, Ark., company has named its Indian outlets BestPrice Modern Wholesale.

Despite the stealth approach, industry experts expect Wal-Mart, known for squeezing efficiencies out of suppliers and supply chains, to have an impact on India’s $375 billion retail market, which is dominated by mom-and-pop businesses and outmoded distribution networks. “We can learn the science of retailing, how to build scale and efficiencies,” says Kishore Biyani, chairman of Pantaloon Retail, India’s largest homegrown retailer with 114 hypermarkets.

The world’s largest retailer isn’t new to India. For the past decade, the country has been an important Wal-Mart supplier of textiles, apparel, home products and jewelry. But in anticipation of its India launch, Wal-Mart for the last three years has been developing a network of suppliers to stock its stores with fresh produce and staples like lentils, wheat and rice — all with an appreciation for variations in local cultures and tastes. “India is not a homogenous market, so ours is not a cookie-cutter approach from the U.S.,” says Raj Jain, president of Wal-Mart India.

Although it is restricted to wholesale operations in its wholly owned stores, Wal-Mart has a small retail presence in India through a fledgling joint venture with New Delhi-based Bharti Enterprises. The U.S. company provides back-end support for Bharti’s chain of 25 Easy Day grocery stores that opened last year.

Although other foreign hypermarket chains are entering the country — British retail group Tesco has a joint venture with India’s giant Tata conglomerate, while France’s Carrefour is said to be in talks with Reliance — Jain says Wal-Mart is in no hurry to unfurl the Wal-Mart flag nationally. “The easiest thing is to roll out stores, but the most difficult is to sustain and feed them,” he says.

Indeed, Indian mass-merchandisers over the last several years expanded frenetically, trying to get a jump on foreign chains should Indian politicians eventually decide to open up the market to direct competition from overseas. Reliance Industries built 940 stores across the country in 18 months. Aditya Birla group has opened 548 stores since 2007. Today, with India’s economy slowing and with losses piling up, the domestic retailers have shut some outlets and laid off employees, partly because of difficulties in keeping large chains supplied with goods. “When you start opening stores and then work backwards, even we get scared,” says Mahadeo Pawar, a vegetable grower from Karjat, 31 miles (50 kms) north of Mumbai.

Caution in India may be a watchword considering the global recession and Wal-Mart’s blemished track record overseas. In 2006, the company pulled out of Germany and South Korea in the face of stiff competition and poor sales. Still, Wal-Mart has been weathering the economic crisis better than most. The company on May 14 announced it earned $3.02 billion in the three months ended April 30, about equal to the profit it made in the same period in 2008. Revenue fell 0.6% to $93.47 billion from $94.04 billion a year earlier. Highlighting the growing importance of markets such as India, nearly one-fourth of Wal-Mart’s sales for the quarter — 22.7% — came from its international division.

According to a study by The Nielsen Company, modern retail dropped prices by more, or increased them by less, for more product categories than traditional retailers, or kiranas, between the last quarter of 2009 (Oct-Dec) and the first quarter of 2010 (Jan-Mar).

“The power of modern retail lies in the scale and efficiencies which we have built over the years,” says Kishore Biyani, CEO of Future Group that operates retail formats such as Food Bazaar, Big Bazaar, Pantaloon and KB’s Fairprice stores.

The Nielsen Shop Census study compared prices of 47 commonly used items including toothpastes, washing powder and confectionery. Modern retail dropped prices by more, or increased them by less, than traditional retailers for 29 product categories while traditional retailers did better in 18 categories.

It collected data from 16,000 stores (11,000 urban and 5,000 rural, in both modern and traditional retail) in 462 towns and 1,427 villages.

During this period, the rate of inflation, as measured by the Wholesale Price index, was hovering around 10% and food inflation was more than 12%.
In the past two years, modern retail has been able to significantly cut operational costs related to real estate rentals, energy costs and increase persquare-feet productivity of employees leading to savings in people costs.
They also launched private labels to get a better grip on selling prices and profit margins, and some savings were passed onto customers.

Higher collaboration with small and medium suppliers as well as distributors of large FMCG companies helped them cut costs in transportation and logistics.

Efficiencies of scale helps one source the goods closer to the manufacturer says Mr Biyani. In 2009, Big Bazaar sourced 26,000 tonnes of rice, 4 crore pieces of clothing, 20 lakh suitcases, 36 lakh mixer-grinders, 45,000 manufactured beds, 20 lakh bedsheets and 19,000 LCD TVs. Each of these figures will be higher by a minimum of 30% for the year 2010, he says. “Such large sourcing allows us to get better prices directly from manufacturers and producers.”

Big Bazaar is the largest player in the segment contributing over 33% of modern retail sales. Other top retail formats competing with traditional kirana for essential purchases include Reliance Retail, Aditya Birla Retail’s More and Spencer’s Retail.

Kumar Rajagopalan, CEO, Retail Association of India, says strong sourcing power helps modern formats offer better prices. “They have done away with the extra level of intermediaries,” he says.

Meanwhile, grocers too are working on protecting their turf by leveraging on their strengths such as customer relationships, home delivery, credit facilities and expanding their product portfolio.

Top FMCG companies such as Hindustan Unilever, Procter & Gamble Marico and Godrej have begun adopting kiranas, teaching them category management and effective merchandising to counter big retailers and their private labels.

Bharatiya Udyog Vyapar Mandal (BUVM), the biggest national-level association of mom-and-pop stores, has formed city-centric associations that negotiate directly with manufacturers such as Unilever and P&G and do away with any middlemen.

This helped kiranas offer 5-20% discounts on MRP of branded products like detergents, shampoos soaps, oil and atta.

“When prices rose due to inflation some kirana stores offered customers the option of paying in instalments apart from extending them credit for a month,” says Vijay Prakash Jain, secretary general of BUVM that comprises 17,000 state and district-level associations across 27 states.

Interestingly, kiranas managed the prices of items such as detergent bars toilet soaps, shampoo, packaged tea and iodised salt better than modern retail, according to the Nielsen study.

Currently, traditional retail, both grocers & chemists, constitute over 95% of total sales in the country.

Modern trade at just 3-5% of the total national industry sales, had grown aggressively at over 35-40% contributing to over 15-25% sales for most consumer goods companies last year.

Hispanic grocery stores — with their vast arrays of peppers and Mexican sweet breads — are steadily opening across the Valley, driven by an explosion in the population they cater to.

The arguments for and against FDI in retail are, at a generic level, valid on both sides. However, since the devil is usually in the detail, the facts about India’s small retailers and suppliers, the conditions stipulated for FDI, and recent experience with the effects of domestic modern retail need to be viewed together before the likely outcome pronounced. The big fight is about whether this new policy will kill small shops, massively destroy livelihoods and take away GenNext’s opportunities. Facts suggest otherwise. Consider the kirana, the one most feared to be at risk. About 5-6 million of the 8 million FMCG-stocking kiranas are in rural India, and are totally safe, as the new ones can only come into the top 53 cities.

R Sriram, founder of Crossword and retail expert, tables two insights. One, in many big cities, kiranas are already not participating in the growth offered by the newer settlements like Gurgaon or Powai, because without their advantage of historically-priced real estate, they are not viable. Two, increasingly, small shopkeepers’ children are getting better educated and want to exit ‘sitting in the shop’ as soon as possible, just as small farmers’ children are exiting farming. Sadly, the country’s retail density has been increasing in recent years, not driven by passion or profit, but because of lack of options — hopefully that will change. It is true that traditional income streams of small shops in the vicinity of a large supermarket plummet; but we have seen that they soon recast their business model, exploiting the inherent advantages they have that the supermarket cannot emulate: free, prompt and no-conditions home delivery, superior and customised customer relationship management, khaata- credit and willingness to stock small quantities of something used by only a few people in their catchment — a classic ‘long-tail’ strategy. Notice two more things: even in upper-class areas in large cities, despite large retail chains in the vicinity, the small vegetable vendor and kirana continue to find a place in the household’s shopping basket. The kirana also continuously morphs, and is already moving to a more specialised and selective portfolio. We will find them variously choosing to become more of a convenience store (7-Eleven-type), or fresh-food store, a home-delivery store, maybe even express-format franchisees of large retail, and so on.

Another reality check: how much consumption capacity do even the top 50 cities have? Seriously, how many more Ikea, Zara, Walmart, Tesco and Best Buy can a Surat, Kanpur or Indore absorb, in addition to more Big Bazaar, Megamart and Croma? Further, foreign specialty retailers targeting the rich consumer will create never-before custom, and not at the expense of existing shops. Two decades ago, we had the same hue and cry that Indian brands would be wiped out; but they got better and bigger than they would have had they been left unchallenged. Now for the suppliers. Large suppliers will lose the pricing power they had with small retailers and nobody on any side of the FDI debate is grieving for them. Small suppliers, even without FDI, are being mercilessly squeezed by middlemen. The hope is that large retail chains, unlike the broker middleman, have more incentive to pay more because they have customer loyalty and a brand to build; in exchange for steady, loyal, consistent quality supply, they will pay more, guarantee offtake, improve product and production efficiency. The FDI norm of at least 30% sourcing from small scale pushes this further. Walmart potentially could kill the small suppliers of anything by importing 70% from China cheaper; but loads of small traders are already doing the same, flooding our markets with Ganesh murtis, chappals, clothes, watches, etc.

The Achilles’ heel for a lot of skilled artisans, specialised producers, grass roots innovators, etc, is market orientation and marketing. Producer collectives have managed to organise themselves on the supply side using government assistance schemes, but they struggle to manage the demand side. That is the missing link that large retailers in vendor development mode can provide, just as the auto industry has done to ancillary suppliers. Both sides agree that customers will gain because large chain retailers can provide better for cheaper, given the discounts they get through buying large quantities and sourcing smartly. Customers will also get a wider range, more innovative products and more comfortable, truthful and informed shopping environment. Poor customers won’t get discriminated against, because the hypermarket is anonymous, transactional, classless and nonjudgemental. They may not get better service because the small Indian retailer is the champion of good service, from atta to electrical, the likes of which we haven’t yet seen any big retailer match, anywhere in the world. That’s another reason why he will always survive.

Before we fight further, consider this. This network of commercially-savvy supplychain linked small retailers is an invaluable asset: as one report said, they are not ‘unorganised’ by any stretch of imagination; we agree and have refrained from using this phrase in this article! It is unlikely that Indian jugaad will let this network disintegrate. Perhaps in rural India, where they would have been more hard hit had the big-box retailers been allowed, they would have been garnered by banks as new extension counters for financial inclusion.

economictimes.com: RAMA BIJAPURKAR INDEPENDENT MARKET STRATEGY CONSULTANT

The TM Chain is controlled by Meikles Limited and is the largest chain of retail stores in Zimbabwe by number of stores, with 51 outlets.

“Yesterday the shareholders of TM Supermarkets voted unanimously to allow Pick n Pay to purchase the additional 24% of shares,” Pick n Pay said.

In November, the Competition and Tariff Commission of Zimbabwe declared that it had examined the competitive effects of the merger on the Zimbabwean market and established that the transaction did not reduce competition or create a monopoly situation, but rather strengthened the ailing TM Supermarkets.

The commission then agreed to Pick n Pay taking its shareholding of TM Supermarkets to 49% subject to certain conditions pertaining to labour and local procurement of goods.

“The acquisition of the additional shareholding in TM Stores has been a protracted one that has stretched over more than three years, and required the approval of the Zimbabwean Investment Authority, the Zimbabwean Reserve Bank, the Zimbabwean National Indigenisation and Economic Empowerment Board, and now finally the approval of the Competition and Tariff Commission of Zimbabwe,” Nick Badminton, Chief Executive Officer of Pick n Pay said.

Dallas Langman, head of group enterprises (Africa) at Pick n Pay said it was important to note that not a cent of the money coming into the TM Stores business would go towards shareholder dividends.

“All the money is earmarked for developing and strengthening TM stores in Zimbabwe. Some seven stores will be rebranded with the Pick n Pay brand, but we wish to express our confidence in the TM brand and respect its history in Zimbabwe,” he stressed.

“The investment will see money being spent on local procurement processes and will give employment to Zimbabweans during the refurbishment of stores and the staffing of them,” Langman added.

The research was conducted in low income neighborhoods in Chicago, where you would expect every dollar to count.

Participants who agreed that they had “convenient access to quality” produce were more than twice as likely to eat the FDA-recommended amounts of fruits and vegetables, compared to those who said they did not have such access. read more from the Washington Post…

While this proves a correlation, it does not necessarily mean causation. The laws of economics have taught us that low prices are indeed a factor in food purchase decisions. Obviously not the only factor.

What we’ve heard and seen (qualitatively) is that many people don’t purchase vegetable because they don’t quite know what to do with them. Or can’t be bothered with the cleaning and trimming which takes time.

That’s why simple and quick recipes need to be made a part of kids’ curriculum in school and extra-curricular activities. If it’s too late for our generation, perhaps our kids can come from school one days and teach us how to prepare broccoli that doesn’t stink.

What’s holding you back from consuming more produce?

No SUV-driving American shopper would be surprised to find 20 lb. sacks of dog chow at a Wal-Mart supercenter. But at an urban minimart that is trying to attract bag-toting pedestrians? Not so much.

Wal-Mart is struggling to expand with small stores as it seeks to penetrate big cities and jumpstart its U.S. growth. It has rolled out only a handful of Wal-Mart Express locations, and their merchandise shows a lack of adaptation from the Supercenter formula, as Shelly Banjo explains on Lunch Break.

Unless that minimart is operated by Wal-Mart Stores Inc. The Bentonville, Ark., retailer is betting that small urban stores called Walmart Express could eventually help jump-start its growth in the U.S. and fight off competition from rapidly expanding dollar-store chains.

The heavy bags of Ol’ Roy dog food suggest Wal-Mart is struggling to think outside the supercenters that remain its focus, analysts say. The world’s largest retailer has rolled out fewer than a dozen Wal-Mart Express locations since it launched the first 15,000 square-foot store a year ago, and experts say its effort to offer supercenter pricing and assortment in small, high-cost spaces is putting pressure on the minimarts’ profitability.

Wal-Mart declined to comment ahead of its quarterly earnings report on Thursday. But in a March analysts’ conference, finance chief Charles Holley said the company didn’t have enough results to open thousands of small-format stores. The venture, he emphasized, was still “a pilot.”

He described the company as moving slowly on purpose, citing a similar, 13-year effort to make its Neighborhood Markets profitable; the company has opened 199 of the grocery stores since 1998 and plans to open 80 this year. Analysts polled by Thomson Reuters project a fiscal first-quarter profit of $1.04 a share on revenue of $110.5 billion; a year earlier, Wal-Mart reported earnings of 97 cents and $104 billion of revenue. The company’s stores open at least a year are expected to report a third-consecutive quarter of modest growth.

Double-digit sales gains overseas have been a big driver of results in recent years. Investors are eager to see Wal-Mart develop a strategy for accelerating its U.S. growth.

The company wants to do the same in the U.S. At Wal-Mart’s annual meeting last June, U.S. stores chief Bill Simon said he would like the Express Stores “to deliver the same experience that a supercenter can deliver, only in 15,000 square feet.”

Problem is Wal-Mart has taken that statement quite literally, said Leon Nicholas of the consulting firm Kantar Retail.

“Wal-Mart can’t pull itself away from a supercenter mind-set,” he said. “Just look at the shelves. It is just absurd to see a dozen kinds of jelly or peanut butter when a shopper just wants to get in and out of the store quickly.”

Prices of items such as Skippy peanut butter and Kellogg’s cornflakes at a Wal-Mart Express store near Fayetteville, Ark. were identical to those at a nearby Wal-Mart supercenter, according to a recent Kantar study. The same buyers select goods for the Express stores as the supercenters.

Some customers like it. Rhonda Wright, 43, filled a plastic basket with items including cocoa butter skin lotion at a Wal-Mart Express in Chicago last week. A bank teller who lives about 15 minutes from the store, Ms. Wright said found it quicker “and a little easier to find things” than at a supercenter.

Some analysts question why Wal-Mart isn’t moving faster and why it has added or remodeled more than 120 supercenters last fiscal year, while other big-box retailers, including Best Buy Co., Staples Inc. and Barnes & Noble Inc. shutter dozens of stores.

“Wal-Mart is the only retailer out there continuing to open up big box stores, which leads me to think they’re not paying enough attention to what the consumer needs,” said Charles Grom, an analyst at Deutsche Bank who has a sell rating on Wal-Mart. “Eleven Express stores is a drop in the bucket.”

—Owen Fletcher contributed to this article.

Write to Shelly Banjo at shelly.banjo@wsj.com

A version of this article appeared May 17, 2012, on page B2 in the U.S. edition of The Wall Street Journal, with the headline: Can Wal-Mart Think Small?.