I come from Ranchi, a small industrial town in India. There was a small kirana store; small by the standards of the new mega retail formats. Shop owner knows every one in the neighborhood by name, their birthday, and anniversary. He mostly offers the regular customers good discount and extend credit for a few weeks.

The kirana store, till late eighties was doing good business but it started losing customers a decade back, as first generation employees of Heavy Engineering Corporation Ltd., started moving to suburbs on retirement. The new modern retailers had also eaten up some of his customers. The kirana store was losing customers and finding it difficult to win new. The Kirana Store owner discussed his problem with Mr. Rabindranath Choubey, an employee of Heavy Engineering Corporation Ltd. and a good friend of the shop owner. He suggested kirana store owner to take the trouble of making home deliveries. This small gesture not only helped him win back his old customers but also helped him attract a few new one.

This story clearly identifies that the kirana store will continue to coexist with the modern forms of retailing, but will need to innovate and change strategies. The kirana store will co-exist for three key reasons:

Relationship: Kirana stores enjoy very close relationship with their consumer. In India Kirana store always enjoy deeper relationship than just the buyer-seller relationship

Credit: The Kirana shop keeper also offers credit for a couple of days to weeks for the purchase made at his outlet. He can afford to do so since he himself enjoys credit from his suppliers.

Convenience: The majority of India’s urban consumers have the convenience of buying small lots & ordering everything over the phone. They even have the luxury of ordering a single small item like a toothbrush delivered at their home at 9:00pm. Until convenience stores like 7-Elevens proliferate though, the kirana stores will continue to play an important role.