Grocery Best 2020

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Grocery Best 2020

Grocery Best 2020
Grocery Best 2020

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  • The business in India is distinctive in many ways, primarily due to the diversity of consumers and the unique distribution models of the retail sector. From mom and pop stores to giant supermarkets to online stores, the business in India operates across channels.
  • However, most of India’s grocery business happens through the unorganized sector, which mainly comprises of small stores, also known as kiranas.
  • There are over 12 million small stores in India and account for over 90% share of the Indian F&G market
  • Indians have traditionally relied on mom and pop stores for their monthly food & grocery needs. These stores have a personal connection with their customers and are well versed in customer preferences,
  • Grocery Best 2020

  • which in turn enables them to stock locally relevant products.
  • Indians prefer buying their monthly supplies from these local stores for various reasons such as proximity, availability of credit, and the option to return/exchange products.
  • Globally, India is the sixth-largest grocery market and has a humongous potential for growth due to the rising population as well as disposable incomes.
  • The Indian market, which accounts for 69% of India’s total retail market, offers plenty of opportunities to retailers.
  • Many retail players have tried tapping into this potential without substantial results. The local kirana is still the epicenter of Indian business with 90% of distribution under its belt.
  • Even as retail giants battle against each other to become the consumer’s habit when it comes to buying, the small stores have held their ground.
  • The Rise of E-grocery:
  • However, with rising disposable incomes and internet penetration, the eGrocery market is expected to grow by leaps and bounds in the near future.
  • The eGrocery market size, which was worth USD 0.69 billion in 2017, is projected to grow to 16 billion by 2020
  • The fact that India is home to the youngest population in the world (avg. age – 27.6 yrs) plays a major role in the predicted shift in the Indian grocery market.
  • Equipped with disposable incomes and smartphones, young consumers are internet savvy and prefer ordering their grocery online, given their busy lifestyle.
  • This change has majorly contributed towards creating a dynamic market environment in India and has opened up opportunities for the organized e-retail players.
  • The small storefronts which double up as mini warehouses are touchpoints in a battle that is brewing to change how Indians buy grocery.
  • The big bet: once you buy an everyday items through a certain channel, you can be eventually coaxed into buying everything through that channel.
  • While online startups like Bigbasket and Grofers are at the vanguard of the digital-led grocery push that is under way, the entrenched e-commerce giants and traditional storefront retailers aren’t far behind.
  • In fact, the country’s leading retail firm Future Group and Amazon India announced a partnership just last month in an effort to find synergies and leverage each other’s network.
  • Beyond those figures, however, big bets are also being placed due to past precedent. Between 2018 and 2020, India’s online food delivery map expanded from roughly 30 cities and towns to more than 500.
  • Currently, online shopping has a similar small footprint, with presence in 25-30 cities
  • While a little bit of competition from new entrants is always good, unless quality is standardized, there is going to be a lot of angst, particularly with fresh produce

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