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FMCG products constantly need to come up with unique, innovative solutions to satisfy the
customer͛s demand, whereas retail has been getting more cheaper and competitive. Departmental
and company-owned stores have been entering into almost every sector of retail, turning the typical
manufacturer to wholesaler and wholesaler to retail.

Recent data showed that FMCG in India accounts for 31% of the total retail and just 3% of it was
organized till the year 2006. In terms of turnover, it shows a 10% annual growth (second highest in
retail segment) every year. In such cases, where the market is so appealing to big retail players like
Tata and Reliance, as well as to manufacturers like ITC, the local ›
 stores have good reason to
worry about their position in the market. Because i think that these supermarkets are slowly
capturing the local kirana shop customers.

Products can be widely divided into four different categories:

1. nique situation products ± products that are not planned or stocked, but are required only in
cases of sudden demand.
2. Low shelf life ± products that are perishable in nature and can be stocked up to a maximum of
two days.
3. Planned grocery ± products that are a must in a family; they are planned and foreseen in terms
of consumption, and are usually bought in huge quantities.
4. High valued product ± products that are expensive and well considered before purchase.

It has been found that people usually buy unique situation products and low shelf-life
products from the local ›
, while planned grocery and high-value products are purchased
in supermarkets that offer better bargains and quality assurance,which give supermarkets
greater margin of profits compared to local kirana stores,and also attract mass customers
toward them. The features of a ›
 and supermarket are quite different .I will explain why
both the kirana and the supermarket are essential to the Indian market.


 stores are owned and operated on a small scale, usually in a space of 500sq.ft. or less.
These places are easily available within residential localities. However, for a supermarket to
operate, a minimum of 2000 sq. ft. would be required, and usually, so much space would
usually be found in commercial localities. 
 stores are operated by the owners
themselves and thus provide the benefit of low operational costs. Supermarkets are capable of
eliminating the wholesalers from the chain and can provide benefits of saved margins. This is
1 good thing which i feel about supermarkets is that it has almost reduced the involvement of
middle men which reduces the overall prices of goods and commodities, so that the money
flow does not go in wrong hand. 
 stores target a much smaller market than
supermarkets and thus, can be more responsive in terms of their exclusive demands.
Moreover, it is likely to receive the newly launched products earlier than ›
 stores.

 stores are likely to be in the immediate locality and thus have a better understanding
of customer preferences. Supermarkets often offer the best bargains, and experts from the
company explain the usage and care of a particular product to its potential buyers.
Supermarkets have big names backing them; moreover they have stronger advertising,
probably on national or state level .Even if one wants to return the bought product to kirana
shop it is a very easy process, compared to supermarket which increases the trust factor both
ways.

That trust factor over the local kirana stores has always been there. Each of us knows our
›
 store for a long time, probably from our birth or so. Thus, the customer-trust ratio is
very high. The billing is also very fast when compared to the supermarket. At the end of the
day, both ›
 and supermarkets are here to stay. And given the unique demands of the
Indian market and its 1 billion plus customers, both of them can co-exist peacefully by
capitalizing on their own unique strengths. Its just that with fast entering of new supermarkets
, somewhere down the lane kirana shops have been affected on a larger perspective.







Sugandha Agrawal

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