India’s vibrant retail tapestry is woven with threads of tradition, innovation and resilience. At the heart of this vibrant ecosystem lie the unorganized retailers – the beloved “kirana” and “medical” stores – cornerstones of communities for centuries offering not just goods but a sense of belonging and familiarity.
A Legacy of Service – From Ancient Traders to Local Saviors
India boasts a rich mercantile heritage. From the enterprising Banjaras to trading communities like Banias, Jains, Marwaris, Sindhis, Bohras, Khojas, and Muplas, these groups have played a pivotal role in shaping Indian commerce for centuries. Kirana stores are the modern-day inheritors of this legacy of service, having adapted and thrived through generations. The recent pandemic further solidified their importance as they stepped up to become local heroes, ensuring access to essential supplies during a time of crisis
The Power of Tradition in a $1.3 Trillion Market
India’s retail sector is a powerhouse, not just domestically, but globally. It currently ranks as the world’s 4th largest retail market, valued at a staggering $ 1.3 trillion. This sector has witnessed impressive growth, with a remarkable 10% YoY increase between 2020-2022. This deep-rooted legacy of kiranas continues today, with the unorganized retail sector accounting for 88% of food retail and 92% of pharma retail in the country.
Unorganized retail is a significant driver of job creation, contributing a substantial 8% to India’s total workforce. This translates to millions of individuals who rely on the unorganized retail sector for their livelihoods. Moreover, the retail sector itself accounts for a significant 10% of India’s GDP, underlining its critical role in the nation’s economic well-being.
Adapting to Change
Despite their dominance, kirana stores have to navigate a landscape characterized by the rise of organized retail and e-commerce. However, their history is a testament to their remarkable adaptability. They have consistently navigated changing consumer preferences and economic fluctuations, proving their ability to evolve.
Emergent Challenges
Kiranas have so far largely competed against E-Commerce players and large organized retailers based on their locational advantage and proximity. They have retained customers by providing the convenience of quick free home delivery and fulfillment of any urgent, top-up request.
A new Quick Commerce business model however is now targeting the on demand purchase market and is likely to undermine the advantage.
Coexistence requires Kiranas to evolve their practices, processes and embrace modern technology.
Collaboration is Key
This research project explores the potential for copetition, a strategy where Kirana stores can participate as omnichannel players with technology-driven business models and digitized operations by leveraging their existing infrastructure and strong customer relationships,
Empowering Kiranas for the Future:
Technology can play a vital role in empowering Kirana’s to thrive in this evolving landscape. By adopting frugal scalable digital solutions, kiranas can offer a seamless shopping experience, integrating online ordering with in-store pickup or home delivery options, enhanced customer engagement, pricing and service enhancement.
Customer Focus is Paramount
Understanding and catering to customer preferences is central to success. Technology can help kiranas personalize their offerings, streamline procurement, and optimize inventory management – all leading to a more customer-centric approach.
Becoming Part of a Larger Ecosystem
By embracing technology and forging strategic partnerships, kiranas can seamlessly integrate into a larger commerce ecosystem. This allows them to compete effectively, expand their reach, and ultimately, secure their place in the future of Indian retail.
About the Project
This research project is a celebration of the enduring spirit of kirana stores. It’s about equipping them with the tools they need to not only survive but thrive in the digital age.
Through retailer and consumer-centric studies, we seek to advance our understanding of areas where frugal digital solutions can contribute to the unorganized sector, fostering a coopetitive environment benefiting all stakeholders.
We invite consumers, retailers, and stakeholders from all walks of life to join hands with us in shaping the future of retail. Your insights, experiences, and aspirations are invaluable as we strive to create meaningful and impactful solutions that benefit us all.
What to Expect
Over the coming months, we will conduct in-depth surveys, engage in meaningful dialogue, and collaborate with experts to identify opportunities for growth, modernization, and community empowerment within the unorganized retail sector. We promise to keep you informed every step of the way and welcome your feedback and suggestions.
Get in Touch
Ready to be part of the process? You can participate in our surveys, contribute to our blogs or join the study. You can reach us at info@kiranamitr.com or visit our website at www.kiranamitr.in