The COVID-19 pandemic and the consequent lockdown have dramatically changed the way people shop for what they need. While stepping out to a supermarket was earlier a matter of course, customers are now hesitant to expose themselves to crowded places. The solution to this has come from an unexpected quarter, kirana stores.
Earlier struggling to stay afloat amidst the stiff competition from supermarkets and e-tailers, Kirana stores have been quietly servicing the needs of 1.4 billion Indians since lockdown began. While large supermarkets and e-commerce stores have grappled with supply issues, neighborhood stores with fewer resources but a greater connect with the hearts of their consumers have gained in popularity.
Paving the Way for Return of Mom-and-Pop Stores
There are over 12 million Kirana stores across India, providing daily essentials and groceries to the families in their vicinity. Through the advent of malls and megamarkets, they have retained their presence and continue to thrive, particularly in the lockdown era.
- Fear of Exposure at Big Stores
Over the past few months, people across India have been nervous about stepping out and exposing themselves to the virus. This fear is exacerbated in the case of supermarkets where there are many other customers who could put them at risk. Kirana stores are thus the natural choice to opt for, as their smaller premises allow fewer people in at a time. Moreover, with most supermarkets and large retailers forced to shut shop during the lockdown, Kirana stores are often the only option.
- Lack of Choice in Online Deliveries
Many customers turned to e-commerce solutions like BigBasket or Swiggy Groceries to get their essentials, but even these come with their pitfalls like delays in delivery, minimum order value, and the inability to choose one’s own produce. Instead, customers can simply step out to the nearest Kirana store and pick up what they need. This also allows them to select products after personally checking for freshness or any blemishes.
- Quick Shopping Experience
With online deliveries, one has to wait several hours and often an entire day before the purchases show up, which can be inconvenient. Instead, one can quickly step out and collect essentials as and when needed from a Kirana store.
- Personal Connect
As opposed to the impersonal experience of shopping online or at a supermarket, the shop owner at a Kirana store often knows his customers well and makes the interaction a friendly one, which encourages the buyer to return. The personal connect also allows for experiences and requests that would not be possible elsewhere, such as the customer calling up the store owner and requesting for certain items to be kept aside for himself.
- Digitised Experience
What is remarkable to note is how the Kirana stores have rapidly adopted new technologies such as digital payments and contactless delivery to ease up the buying process, particularly in a post-Covid world where customers are reluctant to handle cash or cards. The adoption of POS machines and UPI payments by even tiny stores in small towns has enabled a safer shopping experience and also furthered digitisation more rapidly.
Overall, consumer expenditure at Kirana stores has gone up by around 40% since lockdown began in March.
How Kirana Stores are Making Waves in Post-COVID India
To understand the exact impact of the Kirana stores in post-lockdown India, EY conducted a survey across metro and non-metro cities. The survey found that 20% of Kirana stores have started using online platforms to get assistance with deliveries and have a steady supply of goods coming in, while 40% state that they would like to partner with online platforms to help them grow further. Furthermore, 79% of Kirana stores in non-metros and 50% in metros are seeing new customers come in post-lockdown, which indicates a renewed trust in hyperlocal communities. The need to adopt new technologies to improve sales and supply chain management was also recognised; 58% of traders in metros and 46% in non-metros are convinced that digitisation is now a must for them.
In response to this boom in Kirana's growth, the Indian government is drafting new e-commerce policies that will help these stores integrate better into the online ecosystem. Once these policies are in place, Kiranas will be given special packages of incentives to handle both online and offline sales. Moreover, corporate giants like Amazon, Flipkart, and Reliance are now taking an interest in Kirana stores as potential fulfillment partners for their grocery divisions, such as Flipkart’s onboarding of over 50000 Kirana stores to deliver to 850 cities ahead of the festive season.
As India struggles to recover from the blow dealt by the lockdown, Kirana stores have emerged as the unsung heroes helping a country with its daily needs. As storeowners adapt to changing consumer behaviors by adopting technology while continuing to provide the personalised Kirana experience, they could very well emerge as the hubs that strengthen the FMCG distribution network and help the industry recover sooner.