Advertising
Is Snapchat's bid to attract Indian advertisers working?
Quick commerce disrupts India's grocery industry, kirana stores hit hard: Kearney
Kirana stores and modern trade outlets will need to enhance efficiency and streamline operations to remain competitive alongside the growing influence of quick commerce, according to Kearney report
Quick commerce players, Zepto and Swiggy Instamart are prioritizing convenience and profit over food safety
India's grocery industry is undergoing a significant shift as quick commerce players have fuelled incremental demands and influenced purchasing behaviour. The increased access to discounts has hit the general trade severely, including the Kirana store.
According to a report by Kearney, modern trade, e-commerce players and quick commerce consistently provide the highest discounts to consumers. E-commerce and modern trade optimize costs with larger delivery sizes and higher-value baskets, enabling them to offer significant discounts. On the other hand, discounts in quick commerce drop by about 200 to 250 basis points.
According to the analysis, modern trade's 'discount versus MRP' stood at 17.8%, followed by e-commerce at 16.7%, quick commerce at 6-9%, and Kirana at 2-5%, respectively.
However, in terms of employment generation, quick commerce, and general trade were in the same line.
"General trade is the most labour-intensive channel, employing 63 to 66 people per Rs 1 crore of monthly Gross Merchandise Value (GMV). Whereas quick commerce generated 62 to 64 jobs per Rs 1 crore of monthly GMV".
Quick commerce has shifted sales from e-grocery, modern trade, and Kirana stores, but it remains inconsistent across all categories.
According to Kearney, consumers are still purchasing fresh produce (fruits and vegetables) from Kirana, indicating a preference for handpicked non-packaged items. However, snacking, and confectionery, such as munchies, chocolates, and cold beverages are more frequently purchased on quick commerce platforms for instant consumption.
Overall, for all sales happening via quick commerce, a 6 to 8% share is purely incremental, while the rest is coming at the expense of sales from other channels--predominantly modern trade and e-commerce followed by general trade outlets.
The report suggested that kirana stores and modern trade outlets will need to enhance efficiency and streamline operations to remain competitive alongside the growing influence of quick commerce.
According to a report by Kearney, India's grocery sector, including food fast-moving consumer goods (FMCG), non-food FMCG, and fruits and vegetables, is expected to grow by 8% to reach Rs 78 lakh crore by 2029.
"Going forward, quick commerce is expected to play a larger role in the retail sector, coexisting with other channels while continuously adapting to market dynamics and consumer preferences," the report added.
TCS layoffs hint at broader job cuts as IT ditches scale hiring for skills-based model
TCS layoff: Several IT workers from both big and small firms told Storyboard18 that the pace of AI advancement has outpaced humans adaptability in many job roles