May 10, 2021 at 02:58AM

India’s retail market is a large and rapidly growing space, generating  $793 billion in sales in the fiscal year ended March 2020 and is expected to generate $1.5 trillion by 2030, according to estimates reported by the Financial Times.

And that retail market is unusual in that it is home to roughly 20 million kiranas — small mom-and-pop shops known for selling groceries and various sundries — which account for 88 percent of the bricks-and-mortar market.  And it is those kiranas that are increasingly leading India’s retail recovery as the competition among larger retail plates is heating up among larger retailers to bring tens of millions of small mom-and-pop stores into their supply chains.

The kirana opportunity is increasingly tempting in the nation as large retailers are looking for wider audiences and the small shops off up a bridge to a new customer base, Kinjal Shah, vice-president of ICRA Ratings told the FT. 

“The only way they can reach that many customers otherwise is by setting up their own physical stores,” Shah said.

The competition in the nation is fierce, and in some cases getting litigious as different players are attempting to stake out position and advantage in the field, pushed by the dual tailwinds of demonetization, a new national goods and service tax and the COVID-19 pandemic driving an increasing number of smaller retailers toward digital in the last year

“Why should I give them my [sales] data?” shopkeep Anil Kumar Bhadra, who thus far has waved away every offer to save one:  Reliance’s JioMart whose point of sale machine he tried out because all fees were waived. He now orders about 20 percent of his supplies through the app but says the platform has some work to do before he’s willing to make a fuller commitment.

And while the small- to midsized business (SMB) digitization is actively underway in India as a race to bring the kiranas into the orbit of the larger merchants supply chain, the story isn’t unique to that subcontinent:  PYMNTS Global Digital Shopping Index: SMB Edition tells the story of the small merchant and mom and pop shops worldwide diving into digitization head first as they attempt to keep pace with drastically shifting consumer habits.

The big takeaway lesson? There is no right answer. But according to PYMNTS data that is good news not bad because for the viewer across the global landscape what is shaking out in different markets is many right answers to the digitization problem — set by the needs of the small merchants who are adopting them.

The good news is there is no single universal approach to digital commerce. The better news is that finding one of those right solutions isn’t only the provenance of the very large enterprise-scale players in the game. Big companies are more likely than smaller ones to offer robust digital services, but that is more a tendency than a rule, according to the data. In the U.K and Australia, for example, consumers appear to be more likely to utilize digital channels through SMBs than they are for large stores.

 The data further demonstrates shoppers in the U.S. and Brazil who typically shop at large chains are more likely to use digital channels while SMB shoppers in the U.K. and Australia are more likely to use digital channels.

More than three-quarters of SMB shoppers in the U.S. and Brazil made their most recent purchases in a store — 1.4 and 1.7 times the share of regular large-store shoppers, respectively. Meanwhile, SMB shopping in the U.K. and Australia corresponds with digital channel use, with nearly 50 percent of U.K. consumers who most recently did their shopping at SMBs used mobile or computer channels compared to 44 percent who shopped exclusively in brick-and-mortar stores.

Australia’s digitizing small business pattern was even more evident as  SMB shoppers are roughly 1.8 times more likely to employ digital channels than large-store shoppers.

The big picture takeaway — looking at that global picture — is that large merchants continue to hold the eCommerce edge worldwide as they can more quickly get up and running with more robust eCommerce operations, and can thus make a greater portion of their sales online than SMBs can.

When the focus is switched to omnichannel, however, the picture gets more complicated because SMBs have the unique ability to leverage the power of proximity. According to the data, SMBs do as well as large stores in this group. Twelve percent of SMBs that are primarily brick-and-mortar are top performers, matching the portion of large stores in this group. This is also the case for omnichannel store-oriented businesses: 26 percent of SMBs in this category are top performers as are 27 percent of large stores. The data further shows that consumer satisfaction is linked to the level of digital services to which consumers have access.

Digitization, the data demonstrates, is on the march through SMBs worldwide, from Australia to India, the U.S. to the U.K to Brazil and beyond. SMBs are generally less likely to offer digital services at the scale of large-store chains, yet, but they are actively catching up with an eye toward building a better customer experience worldwide.

SMBs may have ground to make up when it comes to offering digital services, the data suggests — but as global news reports and the data make clear, they don’t lack ambition or interest when it comes to building what’s next for the customer shopping experience here, there and everywhere.

India’s Mom-And-Pop Revolution And SMBs’ Global Preparation For Reopening …

Selected by EFXA

Search Web: India’s Mom-And-Pop Revolution And SMBs’ Global Preparation For Reopening

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>