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Kirana King
Kirana King
Currently, Kirana King has transformed close to 200 stores in Jaipur and looks to touch
7000 stores across 14 cities in the next five years
Backed by RVCF, Kirana King looks to raise $10-12 Mn in the coming years to attain a
reasonable market share by 2025
But in 2021, there’s a new challenge for Kirana stores in the country.
The fight this time is from online grocery players like Big Basket,
Grofers, Nature’s Basket, and RelianceSmart among others. The value
proposition being offered by online grocery companies is ease of
ordering online, home delivery, and discounts on large orders.
Kirana stores in India have their own resilience. It was quite visible
during the pandemic, when only the neighbourhood kirana store
owners could ensure supply of daily essentials for over a billion people,
as the entire country went into lockdown, making it difficult for online
grocery players to ensure timely delivery of goods.
Retail accounts for almost 11% of the country’s GDP and employs more
than 8% of the workforce – and 88% of the sector is unorganized, as
per Accenture’s ‘Kirana Transformation In India’ report. Experts believe
that the unorganized players will require modernisation, adoption of
technology, financial access and employee upskilling to take on the big
online grocery retailers.
By the end of this year, the Kirana King plans to have 500 stores under its umbrella.
Kirana King told Inc42 that it invests close to INR 70-85K per store,
which includes revamping of the store, setting up of the technology
infrastructure, labour cost and managing the distribution channel.
However, the company earns its revenue through brand partnerships,
private labels, and commissions from marketing and advertising of
products at the Kirana King stores.
Besides Kirana King, other players in the space also include Walmart
(Mera Kirana), Metro, ShopX and others, who have been pivotal in
modernising kiranas and upskilling store owners to generate more
income.
For instance, both Metro and Walmart’s Mera Kirana initiative offers
discounted products to retailers and advises them on various aspects
of using low-cost modern techniques and processes, including
assortment planning, layout and fixtures, displays, backroom, licenses,
safe food handling, customer retention and other services. ShopX, on
the other hand, provides access to eCommerce through its retailer
network.
The company did not reveal the names of payments and logistics
vendors, however, Kumar said that they had tied up with some of the
regional brands like Bhikharam Chandmal Namkeen, Rufill Ghee,
Mulberry confectionery, Manwar Papad, TANSUKH Atta and others.
The deal requires retailers to push these brands on Kirana King stores.
It helps create consumer pull for these brands through various
branding and marketing activities.
But Kumar has a different take. According to him, their business model
is Opex intensive, and not much capital intensive as it is fully asset-
light both at front-end and back-end supply side. “Capital is one time,
on the shop facelift, which easily has a lifetime value of three to four
years,” he added, pointing at other tech-based startups who tend to
spend a lot of money on consumer acquisition.
Kirana King told Inc42 that in the first financial year it had onboarded
close to 110 stores and made revenue of about INR 15 Cr in FY19-20,
and in the current financial year, the company looks to earn close to
INR 45-50 Cr. “We look to expand to about 7000 stores across 14 cities
in the next five years,” concluded Kumar.