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The market share of traditional kirana stores in India is steadily declining as quick commerce platforms are gaining market share, according to a report by Datum.
The report revealed that kirana stores' market share fell from 95 per cent in 2018 to 92.6 per cent in 2023 and is projected to drop further to 88.9 per cent by 2028.
This shift highlights the growing preference of consumers for online grocery shopping.
The report predicted a 74 per cent growth in the quick commerce segment in 2024, making it the fastest-growing retail channel during the 2023-28 period.
With a compound annual growth rate (CAGR) of 48 per cent, quick commerce is poised to revolutionise the grocery market.
"Quick commerce is expected to increase the channel shift from kirana to online grocery," the report read.
The impact on kirana stores is significant, as per the report, 46 per cent of quick commerce users have reduced purchases from kirana stores. Over 82 per cent of the buyers have shifted at least 25 per cent of their purchases from kirana stores to quick commerce platforms.
The data also noted that the survey reveals that 5 per cent of the respondents have completely stopped buying from kirana stores. It says, "Prior to the advent of quick commerce, kirana stores were the primary destination for unplanned grocery purchases due to their convenient locations and flexible operating hours".
It also mentioned that an estimated $1.28 billion worth of kirana sales are expected to move to quick commerce platforms in 2024, accounting for 21 per cent of the latter's total sales. The report stated that quick commerce offsets traditional retail's high channel costs by eliminating intermediaries and replacing them with streamlined delivery systems. As long as delivery costs remain lower than savings from channel consolidation, these platforms can offer competitive prices, further eroding Kirana stores' dominance.
This shift highlights the challenges faced by kirana stores in adapting to changing consumer behaviour, driven by convenience, speed, and cost-effectiveness offered by quick commerce.
- Also read: Quick Commerce captures nearly half of Kirana sales; market projected to hit $40 billion by 2030
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