Quick commerce is rocketing. So, are kiranas on the way out?

livemint.com:

Subscribe to enjoy similar stories. New Delhi: In little more than a couple of years, quick commerce has turned into the great hope of India’s startup landscape. Zomato, Zepto and Swiggy dominate, even as Big Basket, Amazon and others are trying to muscle in.

In this beeline for a slice of retail, what’s going to happen to that staple of the Indian street—the neighbourhood kirana store? When big box stores such as Big Basket entered the Indian market, kirana stores were predicted to be on their way out, mirroring the trend in more developed markets such as the US, where small mom-and-pop shops simply couldn’t compete with the scale and pricing power of a Walmart. As of 2023-24, according to data compiled by the National Sample Survey, there were around 22.8 million ‘unincorporated’ establishments conducting some sort of trade. The vast majority of these—between 80% and 90%—were specifically in retail trade (kiranas), employing an average of less than two workers.

And while the number of such retail outlets grew by about 230,000 in a year between 2022-23 and 2023-24, their count fell by a similar number between 2015-16 and 2023-24. The government’s Annual Survey of Unincorporated Sector Enterprises (2023-24), the data that was released late last month, covers three broad sectors. These are trade (of which 80-90%, as pointed out earlier, are retail trade shops); manufacturing, and ‘other services’ (establishments engaged in services sectors other than retail).

All these establishments are tiny. On average, they employ barely 1-2 people, including the proprietor. On average, they do ₹3 lakh to ₹7 lakh of business a year, depending on whether they are located in rural or urban areas.