The transformation of just 10 percent of the 13 million traditional grocery retailers in India, known as Kirana stores, could boost retail consumption by more than 5 percent and generate approximately 3.2 million new jobs in India.
According to a new report from Accenture and Trust For Retailers and Retail Associates of India (TRRAIN) titled ‘Transforming Kirana Stores to Drive Economic Growth,’ the report outlines a strategic approach for unlocking value by transforming Kirana stores through a seven-stage framework that focuses on store location and layout; technology; store funding; and product placement, among other factors.
“The rapid changes in consumer behavior and acceleration of online commerce, mandate that the Indian retail ecosystem transform to meet emerging consumer needs,” said Piyush N. Singh, India Market Unit lead.
“As the lifeline of the Indian retail sector, a digital-led transformation of Kirana stores can result in significant economic gains, including a nearly 1 percent employment growth in India. The transformation process needs to be expedited with comprehensive policy intervention, technology support, and, most importantly, collaboration between key ecosystem players,” he further adds.
“The modernization of Kirana stores will not only help improve consumption and local employment but will also have a positive impact on the retail ecosystem in terms of new growth opportunities,” said Sameer Amte, a managing director in Accenture’s Strategy & Consulting business in India. “We believe with an improved, intelligent supply chain infrastructure, easier access to technology and funds, these stores can redefine the future of the Indian retail landscape.”
The modernization of Kirana stores should focus on local assessment, funding assessment, store layout, technology, product placement practices and customer engagement.
“India is a nation of shopkeepers, and Kirana stores play a crucial role in the Indian retail sector, which in turn contributes nearly 11 percent of the nation’s gross domestic product and 8 percent of its total workforce. Kirana transformation will not only help store owners improve profitability but also add value to the customers and overall ecosystem. This report puts the spotlight on the pivotal role of the Kirana stores in the community and the impact of their transformation not just on them and the industry, but also on India as a whole,” said B.S. Nagesh, founder of TRRAIN. “We believe the report will serve as a foundation as we march ahead in our journey to impact millions of Kirana store owners in India.”
E-commerce and cash-and-carry retailers can leverage Kirana stores for last-mile delivery in remote places and in turn support them with digital technology such as digital payment solutions at the point of sale, the report highlights.
Intermediary players such as wholesalers and logistics providers need to modernize to fulfill the needs of the transformed retail ecosystem, it further adds.