The Indian arm of German wholesale retailer is betting big on its kirana play to widen its reach. Can Metro Cash & Carry aggressively pursue its bullish intent?
A year later, in Shahdara, Delhi, it was Manoj Narang’s turn to face some critical questions. “Narang sahab, why don’t you stock some frozen snacks, and ready-to-cook products,” the store manager politely asked the 50-year-old kirana owner who had his shop in Delshad Garden, some 15 minutes from Metro’s first outlet in Delhi which was rolled out in 2012. The manager spent a good thirty minutes talking to the second-generation entrepreneur, figuring out his pain points and bottlenecks hampering growth in revenue.
Fast forward to Zirakpur, some 40 minutes from Chandigarh. Manohar Chaddha was struggling to find the right answers. “If you are selling baby diapers, then why aren’t you able to sell milk powder and other baby care products,” asked one of the customer care executives of the Metro store. On his daily visit to the mom-and-pop stores to take orders, the executive tried to reason with kirana owner Chaddha who had been reluctant to give his decade-old-shop a much-needed makeover.
For suitors like Metro, who are aggressively wooing kiranas with unique and customised services, offers and products, the future prospects are promising. By 2025, according to estimates by consulting firm Redseer, the Indian retail market will increase to $1,297 billion in value, of which organised online play would be just 8 percent. While 14 percent would remain with organised offline players, a staggering 77 percent would still be unorganised.
Contrary to popular perception, Mediratta underlines, kiranas are growing. “They were growing in 2016, they grew last year and will continue to do so,” he says, adding that, during the pandemic, sales for kiranas went up. Metro Cash & Carry, he stresses, just tried to be empathetic towards the needs of the kirana owners who had been grappling with issues on the supply and demand side. What was missing was transparent pricing, better assortment, catering to the emerging needs of the customers, and data analytics. Metro, he lets on, plugged the gap. “You can no longer be a fuddy-duddy store owner,” he says. “We are converting 1-2 kiranas to smart kiranas every day,” he claims.
The question to ask now is can Metro outsmart a bunch of heavily-loaded rivals like Reliance, Walmart and Amazon? Experts reckon the challenge is daunting. “It is becoming a crowded space,” says Nimesh Kampani, co-founder and CEO of Trica, a platform for family offices and UHNIs to invest in startups. Amazon’s Kirana Now, Tata-BigBasket combine, and Reliance JioMart are hyper aggressive to expand their reach among kiranas. “Not to forget online grocery players like Blinkit, and even delivery-platforms like Swiggy and Dunzo have a fair share in metros,” he adds.