Kirana shops can learn from global peers: Nirmalya Kumar

MUMBAI: Indian kirana shops may have come together in their opposition to big retail, but they could do well to learn a few things from their global counterparts. According to Nirmalya Kumar, director, centre for marketing and co-director , Aditya Birla India Centre, London Business School, “Indian traders have come together only because they feel the volumes are dropping drop. But globally, a few mom-and-pop shops have read the writing on the wall and have united under a common banner.”

For instance, Ace Hardware is a chain based in the US, exclusively consisting of mom-and-pop stores, who have come together under a common banner. They then negotiate with manufacturers over prices, margins and distribution, the last of which is centralised exactly like an organised retailer.

Prof Kumar says that Indian kiranas will continue to survive because they have one of four attributes of a successful retailer — either to be the cheapest, the biggest, the best, or the nearest. While traders have sensed the threat from big retail, like the Maharashtra Consumer Products Distributors Federation in Akola, an amalgamation of the regional wholesalers, the kirana stores have not yet come together under a concrete banner.

In the debate over big retail and the battle between corporates and small traders, the two principal characters have been completely sidelined — the consumers and the farmers, believes Prof Kumar. More than anyone, consumers and farmers will gain the most from organised retail.

Says Prof Kumar, “The debate has been centred around the losses of job to the traders by organised retail. That’s very visible job loss, but organised retail is still the biggest job creator worldwide.” Big retailers , he feels, have become very defensive and need to address the two important aspects of job creation and benefits to farmers and consumers.