kiranas: Direct to retail app based ordering by kiranas surged post covid

kiranas: Direct to retail app based ordering by kiranas surged post covid

Kirana stores ordered nearly $4 billion worth of groceries and daily essentials either from organised cash and carry companies or directly from companies through online apps, circumventing traditional distributors after last-mile delivery were disrupted due to Covid-19 restrictions.

In fact, most companies including Hindustan Unilever, ITC and Marico launched their internal ordering app and have since onboarded millions of mom-and-pop stores on the platform, generating sales of about $1 billion last fiscal, according to latest report by Bizom, which tracks the sales of 7.5 million retail stores across the country.

Last week, HUL in an analyst meet said its Shikhar app has six lakh retailers accounting for 10% of total orders compared to pre-pandemic when the app had less than a lakh kirana members.

In the latest annual report, ITC said it was among the first in the industry to launch an online ordering system for retailers to mitigate the disruption in sales operations. “Customers were facilitated by trade marketing and distribution to scale up tele-calling and WhatsApp based order taking from retailers,” ITC added.

There are an estimated 10-15 million kirana stores in India and traditional wholesalers still have a big role to play in the distribution of fast moving consumer goods. During lockdown, several small grocers rushed in to buy daily essentials from the big-box wholesale formats after routine servicing by wholesalers and distributors dropped significantly.

German wholesaler Metro also launched its app in April last year and has since enrolled over 2.5 lakh kiranas and small retailers for online orders. In fact, the e-commerce app contributes 16% of Metro’s overall sales. “Technology is playing a vital role in transforming the retail experience and today, kirana stores are more open to embrace technology and go digital versus a year ago. During the pandemic, a lot of kiranas have leveraged online platforms for supply chain needs and delivery, and are now more keen to adopt an omni-channel approach for their end customers,” said Metro Cash and Carry India managing director Arvind Mediratta.

There are less than one offline wholesale store per lakh retailers, which is grossly inadequate, especially to the underserved retailers in Tier 3 cities and rural villages of India.

“Also, data available to online B2B wholesale platforms is of huge relevance to large FMCG companies and understanding sales across a wider spectrum of products offers information on what to distribute and where to distribute,” said Akshay D’Souza, chief of growth and insights at Mobisy Technologies, which owns Bizom.

Last year, more than dozen consumer goods companies including Hindustan Unilever, ITC, Mondelez, Procter & Gamble, Dabur and Colgate started selling products directly to consumers and partnered startups such as Dunzo, Scootsy and Swiggy by listing brand stores on their portals and even reaching out to resident welfare associations (RWAs) through their sales staff.

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