The tussle runs high between traditional Kirana stores and quick commerce apps like Zomato’s Blinkit, Zepto, BigBasket’s BBNow, Swiggy Instamart and Flipkart Minutes, but the game is not entirely over for kirana stores, according to an Economic Times report, which added that they have been affected mostly in metros and are forced to transition the way they do their business.
India currently has around 13 million kirana stores selling groceries and daily essentials and they all are the primary backbone for FMCG companies, especially when it comes to tier 2 and tier 3 cities and villages, according to the report.
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“We don’t see any massive shift in retail dynamics moving away from Kirana stores in the foreseeable future,” the report quoted Mayank Shah, vice-president of Parle Products as saying. “Yes, quick commerce is the new rapidly growing channel, but even as we speak, 85-87% of our annual sales continues to come from neighbourhood grocery stores, and remain crucial to our boardroom strategies.”
Though the situation for Kirana stores is way more grim in metros, some are finding alternative ways to stay afloat.
For example, the report cited Jairam Hegde, a shopkeeper based in Bengaluru’s Koramangala as havin turned two of his Kirana shops into dark stores for Zepto. Dark stores are warehouses for quick commerce companies.
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“There was no other way out. At least I have an income now,” the report quoted Hegde as saying. “Don’t wait to adapt to changing times. Transition now unless you have the ability to sustain for the long term.”
This is however, only for those who own their shops. The report also quoted Vipin Kumar, who runs Gupta General Store in a large housing society in Noida as saying “those who own their shops may somehow manage to continue, but shopkeepers like us who have rented space won’t be able to. Rent is going up. We don’t have enough sales to generate profit after paying rent. We will have to exit.”
Kumar pays ₹40,000 a month for renting his shop.
Another issue affecting brick-and-mortar stores are the steep discounts offered by quick commerce firms.
The All India Consumer Products Distributors Federation, a distributors’ body, wrote an open letter to FMCG companies last month, alleging “predatory pricing and deep discounts by quick commerce platforms are harming domestic traders in the country.”
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