Tuesday, March 10, 2020

Kirana Stores - An Off the Scale market in the making

Despite all the technology at their disposal, Amazon's and flipkarts of India are still not profitable as compared to a small kirana store or mom and pop store which are run by a smart phone wielding man with the pedigree of many generation running the same business.

If this is any fact to go by then the hypothesis of digitally equipping such stores for better ROI, profitability, efficient supply chain looses its sheen and looks like just an eyewash.

These kirana stores were there and serving the neighborhood when Amazon's and flipkart's weren't around. These stores have stood the test of time and survived all sort of predatory practices with cashback's, one plus one offer, no questions asked return policy by the online sellers with deep pockets.

So what works for these kirana stores :-

a) by being next door. No eCommerce site can ever be faster than the local kirana store
b) personal repo with the shoppers
c) you don't need money to go and buy from them
d) free home delivery without needing any logistics partner
e) knows the demand and only shelves SKU's that sells

These are some quite obvious advantages of kirana stores but under the hood there is more happening than what is visible to naked eyes.

He is the real influencer who is listened to and can swing brand loyalty of any die hard customer from brand A to brand B2B... He just has to say that i also use it or brand A is in more demand than brand B.

He can easily cross sell/up sell as he has the trust of the neighborhood customer. I think nobody would contest if we say that the conversion rate of potential leads in an area is more for kirana shop owner than all the fancy content pushed by big giants thru Push notification/SMS/Email

But wait, what new wisdom am i sharing here. Isn't this known to everyone and i seem to be grinding the floor in a loop here.

Hmm, the point i am trying to tell myself more than anyone else is that the key objective is to free up the man. The man who is behind the counter. Give him enough digital tools so that he can save substantial time and do more. Just like what pressure cooker and mixie has done in Indian kitchens.

This could be in the form of POS machine, Digital payments, App based Udhaar khata, integrated B2B marketplace with Suppliers for a lean Supply Chain.

As they say all roads lead to Rome, does all this technology led enablement leads to easier and quicker trade finance!!

Overall, it is an exciting time for this segment to show signs of newer business models, ecosystems, more efficient supply chain logistics and much more.

If you get a chance, download our android app 

(apologies to the apple users, we are coming soon on AppStore)
Its a Udhaar Bahi Khata, Hisaab Kitaab, Expense ledger, Money manager app. Buku is your simplified digital account book to maintain khata and expenses. It is 100% Private and Secure for all types of business ( like retailers/shop keepers /distributors/ stockist/ whole-sellers/ traders/ service providers etc.) as well as personal use.

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