Kirana Stores – See the tables turn

• Published on May 12, 2020

Status is onlinePratekk AgarwaalStartup CXO | Speaker | Advisor | BharatPe , ftcash , Bajaj Finserv | Payments | Fintech Lending | Alliances | IIM-K Alumni1 article Following

We know them as Kirana’s / Retailers / #MSME / Grocery Stores – I have been working with for almost a decade now and have seen significant adoption to credit products and technologies like POS machines, digital khatabook ( bahikhata), online payment options like #UPI, #Paytm wallets, QR and link payment apps.

Let me share my recent experience with a local store (Tanisha Super Market in Mumbai ) near my house . This has completely changed my perception for good and might not be a reversible one.

Here it goes – Around early April 2020, we were in week two of the lockdown when the grocery started to dry up and I find myself toggling between several apps to order groceries and struggling to find the essentials. Sometimes the products would be out to stock and sometimes there would be no delivery slot available. This was never the case past a few years that I could think off – I was also forced to download the new apps which had recently introduced delivery services and were still struggling to fill up the pantry in my house.

My wife, finally fed up of my antics, decided to call the local grocery store. In precisely less than 2 hours, two big bags were waiting for me at my doorstep. From chips to biscuits and even a few packs of Maggie and mushrooms were delivered.

I was beyond shock. How did a local store manage to deliver all these goods when the apps of the world were struggling to?

• How did the store acquire all of these?
• Is the #supplychain all sorted at the back ?
• How were they managing their inventory with the erratic demand and supply?

You can see the tables turning and the ecosystem getting adapted to the local stores instead. Wow! That certainly was something to look out for !. 

While I am still amazed, it’s been more than 5 weeks that we have been ordering from this guy with near 95% accuracy. That too a prepaid order ( all remote payments accepted 😮) and no cash transaction.

Very recently #Amazon announced to boost its pilot project, ‘local shops on Amazon’ that added about 5000 local stores across India. 

#Facebook and #Jio tying up – millions of kirana stores under JioMart and reap benefits of scale and convenience.

#Swiggy recently launched the #Grocery and Genie. This shift in the retail sector has not only benefited the local shops but also given a huge boost to various startups. 

While all the players were hoping to piggyback on the sudden surge in demand to make their mark, they were hugely unprepared. India has traditionally been a hyper-local delivery business. Maybe that’s why the big players never saw any reason to invest heavily in building an asset for the same. But this #lockdown has completely turned the tables.

The most important question of all, what roles will these local kirana stores play in the post lockdown world?

I believe the big FMCG and retail giants will have some real re-modelling to do. No longer can they ignore these local kirana stores. The ease and convenience they offer have become an essential part of every household now.

Rather than trying to replace these stores, as has been the trend so far, the post lockdown scenario will be very different.

Some of these might be real –

• Kirana shops are going to become an integral part of the retail buying experience.
• The supply chain of FMCGs and essentials will be revamped to meet their requirements
• Kirana stores will become core next door delivery options for every household ( may start getting an SoW ( Share of Wallet) of the order which was going to the Apps of the world).
• Timely delivery of goods will be the key parameter and a game-changer in the coming months.
• Co-branded local stores will be the new trend. 
• Big players are already seeking out local stores to tie-up with.
• Might see the retail giants tying up with the Kirana’s for last-mile delivery in the near future.
• Some will become exclusive and will support them to scale and reach out to end consumer.
• Use of technology (CRM/ Order Mgmt / Invoice) playing an important role in a few quarters from now.
• Business Loans for expansion/renovation and invoice financing will see a rise post stabilization.

In near future – I might see myself ordering on the grocery app but the fulfillment will be done by Tanisha Supermarket 🙂

The future can be very unpredictable. Do you think this trend is here to stay?