There is one sector of the economy which is completely satisfied with their sales during the pandemic. This sector is the Kirana store sector. Age-old shops, with old uncles selling all the necessities are part of every colony in India. The shops are not just the places where people buy goods but also the places where people meet, exchange information and create new relationships. With the advancement of technology, people started going to the hypermarket seeing the fancy shops and their discounts. But with the pandemic looming over our heads, people have reported back to their roots. Kirana stores have taken up various measures like avoid closed spaces, billing in one minute, 6 feet gap between every customer and what not. The number of people coming in the stores has gone up along with the basket value. The shops have played a very important role in the procurement of daily items like bread and milk. Along with that, various logistics and technology companies are coming to the stores so that they can sustain in the long run.
There are various benefits of the stores. They are located near one’s house, they deliver at home at a convenient time, they also offer friendly service where buyers and sellers know that it is the mutual relationship of trust and love.
With the panic buying and going on and self-isolation being implemented in one night, the amount of money people have spent on groceries has gone up. People have stopped going to the malls and are only going to Kirana stores. Food traffic went up by 42%.
The store literally runs the country of 1.3 billion people. E-commerce only caters to 120 million people. The obstacles faced by various online delivery platforms is the sole reason why people have resorted to their neighbouring stores and not to these online delivery platforms. A delivery boy of Swiggy infected more than 70 houses in the locality. All these issues pertaining to one’s health cannot be ignored. The unorganised sector is taking a boom.
Large supermarkets which talk about technology advancement in marketing and nowhere in pictures as the company are trying to sustain themselves. The government had allowed 51% FDI in multi-brand retail stores but the Modi government reduced it. Since the beginning of the pandemic, either online mode of shopping is going on or the Kirana stores. Since the distributors are unable to bring supplies to the huge stores, the stores are flourishing. People actually find it convenient to walk a short distance to pick up their daily necessities. Various Kirana stores are working with Facebook and Jio in order to equip them in the right technological way. Social distancing is the way to move forward and the stores are now getting equipped with that.
It is true that the supply chain is also breaking for the sector but the truth is that these people have emotional connections with their suppliers and hence the suppliers tend to cater to these people on time. A lot of panic buying has been going on in India which is boosting the revenue of the sector. If these age-old stores can go towards the path of digitisation, every business can because the one business that survives 2020, they can survive any other lockdown. This is a unique situation for everyone and those who adapt themselves will only triumph.
There has been a 40% spike in the consumer spending at the Kirana stores during the lockdown. People of the country might not have enough money but they would sustain themselves no matter what. They would buy their daily essentials and continue this chain.
A Kirana store owner said that earlier it would be in months that he would refill the shop but now it happens in days because the demand for goods has gone up. He says that other businesses are going downhill but his business is going up. Also, he cannot offer the kind of discounts online traders offers but he can offer security and sanitation of the goods. He works for long hours so that social distancing can be maintained and only less number of consumers are handled at a specific time.
According to the Retailers Association of India, the availability of essentials is least impacted in a country. Kirana stores have become the lifeline of the country. The middle and upper-middle-income group consumers have come back to the Kirana stores because they do not have access to big supermarkets. Moreover, packaged products are selling at a much faster pace and even the stores cannot keep up with the demand. Rather than buying the ready-made food from outside, people are procuring the groceries and are making it at home.
Even the big retailers like Flipkart, Amazon, reliance have planned to tie-up with the stores and to make them the pick up points. This will give the chance to the consumers to take the deliveries whenever they are free and whenever they can go out. The next wave of digitisation will be beneficial for the store.
But it is also said that this is a short-term growth for the stores. The general belief is that because of the current situation and current scenario, most neighbourhoods will continue to favour the stores but once the pandemic is over people will go back to big supermarkets once or twice a month to procure their groceries. Nothing concrete can be taken out of all the assumptions that have been made by the researchers because Kirana stores do not just offer goods, they also have a deep relationship with the people and the customers. Some consumers will remain loyal while some will go to the big supermarkets. They will have a lot of pressure to fulfil the demand of every customer.
Reliance, Walmart and Metro are serving the Kirana stores and supplying them in bulk so that they can also benefit from the pricing strategy. The small stores are evolving with evolving technology.
The big brands know that they cannot create a name for themselves during the pandemic because of the major issue of trust. Hence they have resorted to the Kirana stores so that it can be a profitable situation for both the parties. Amazon has associated itself with over 5000 Kirana stores on its platform. Flipkart also has tie-ups with them. Only 2% of the overall sales in the FMCG sector goes through the e-commerce chain.
Also with respect to the Kirana stores, customers tend to pay them after some amount has been accumulated. This is also the major reason why various people purchase commodities from them. In the long run, the major question arises that who will provide more value to the customers?