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How Modern Retail Can Collaborate With Kiranas In Driving Greater Growth And Boosting Economy
Considering the pros and cons of modern retailers and Kirana stores, a symbiotic relationship can boost both and benefit customers too.
Photo Credit : thenewsminute.com
The local Kiranas are not merely stores but a veritable warehouse for our daily necessities. From essential to sundry items, these small shops sell thousands of goods that we need daily.
In addition, despite the e-commerce boom, Kiranas remain the biggest distributors of FMCG products even today. Presently, all the hype notwithstanding, modern retailers still cannot match the daily convenience and comfort that nearby Kirana stores offer.
Why collaboration is imperative
Readers might wonder that if Kirana stores are doing so well, why should they undertake expensive measures to modernise or collaborate with modern retailers. To understand the compulsions, some background information is essential.
As per a PWC report, the Indian retail sector is considered one of the world’s most exciting retail destinations, which is witnessing high growth rates in the organised segment. Nonetheless, 90 per cent of India’s $700 billion retail markets still remains unorganised, comprising mainly of Kirana stores, selling groceries and other daily essentials.
In spite of the convenience they offer customers, Kiranas have seen their monthly sales fall after the advent of modern retail. Moreover, millennial as well as other customers are enjoying the wholesome experience that modern retailers offer, which includes ready-to-eat snacks. Given the steady erosion in their volumes, Kiranas have realised the importance of technology up-gradation and modernisation in order to drive better sales.
On the other hand, though technology-driven modern retail stores are witnessing rising volumes, they continue to incur losses year after year due to high overheads and allied expenses. In one way or the other, Kiranas and modern retailers both have their individual pain points.
A state of the perennial conflict between the two retail segments is, therefore, not in the interests of either. Instead, an accommodative and collaborative approach between both parties could create a winning proposition, besides benefitting their customers too. While modern retailers could expand their footprints through such tie-ups without heavy investments, Kiranas would benefit from upgrading and offering their local customers a much better experience backed by a wider array of goods and services.
Through collaborations with modern retail chains, the Kirana stores can transform themselves completely, in terms of both, customer-facing and back-end operations. These stores could then manage their stock inventories and anticipate the choices and needs of customers well in advance simply by looking at the dashboard. This can go a long way in reducing wastage since slow-selling items can be discontinued and replaced with a fast-moving inventory.
Moreover, Kirana store owners can curb or stop pilferage of products in their outlets. By working with modern retailers, these neighbourhood stores will receive the much-needed makeover in terms of interiors and also be equipped with the latest technologies. For instance, the installation of CCTV cameras can ensure all in-store activities are recorded and any thefts instantly caught on camera.
Furthermore, Kirana stores can move to full acceptance of digital payment modes, boosting their payment processes via cashless options such as credit and debit cards, Paytm, Google Pay, etc. Ensuring GST-compliant invoices to customers will also be facilitated. Through digitalisation, payments can be managed more easily while minimising mishandling of cash or even embezzlement. Also, a tax-compliant billing system can ensure transparency in financial dealings.
Additionally, with captive customer-purchase data, Kiranas can send promotional offers and discount vouchers to customers. Apart from attracting new customers, such schemes will drive greater customer retention and loyalty.
Similarly, modern retail stores will greatly benefit through such collaborations by having more pick-up and storage points in various cities, thanks to Kirana stores. With easy access to such points, product inventory will remain robust and storage issues will become a thing of the past, simultaneously reducing wastage as well as overstocking. Timely home deliveries will also be facilitated as retailers can assign the order to the nearest Kirana store.
Clearly, a symbiotic association between Kirana stores and modern retail chains will benefit traders as well as customers and the economy too.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.