Kirana stores are shops that serve daily needs products and commonly used grocery items, while supermarkets are large self-service retail shops that sell a wide range of food and other household goods.
Both of them have their own merits and demerits, but both have proven to be profitable businesses. Opening a kirana store needs a moderate amount of investment while opening a supermarket would involve overwhelming costs. The locality of a store is important, as easy accessibility is a key factor in the success of the business.
- Operating cost
- Low inventory cost
- The variety of commodities
- Attention to Customers
- Monthly credit system
- Delivery system, (Kirana store is convenient to buy 1 or 2 things whereas not convenient in supermarket)
- Store Design
- Waiting time
- Scope for manipulation
While well-known brands are trying their hand in the supermarket business, there are other large retail companies, who are planning to leverage the power of kirana stores, by giving them a modern touch.
Let us see an interesting comparison between a kirana store and a supermarket.
The operating cost of a supermarket greatly varies from that of a kirana store. Both of them have to bear the expenses of re-stocking, paying their employees, electricity bills and other areas of expenditure but on different scales. Kirana stores have a lesser or no number of employees while the supermarket needs to have a specific number of employees according to the size and market demands.
Low inventory cost
Since the supermarket is bigger in size and hosts a large amount of goods, bigger is the electricity bill and the re-stocking expenditure. Although the restocking happens in a bulk quantity with a considerable amount of discount, it still adds up to large amounts.
A supermarket boasts of a huge variety of commodities as compared to kirana stores and hence holds a slight edge over the kirana stores as all the requirements of a customer are served under one roof. Kirana stores are limited to grocery and small quantity purchase.
Attention to customers
Kirana stores provide individual attention to customers, which helps in retention of customers. Direct interaction with the customers can give the owner feedback on the service and thereby a chance to fill the loopholes. Frequent purchases of a customer and desirability of brands among customers can be monitored and used to advantage here.
All this also helps the shop owner keep up with the market trends. Continued visits of customers helps in building rapport and can also improve chances of getting bulk orders. The same level of attention cannot be provided in supermarkets at an individual level due higher inflow of customers, and minimal interaction.
Monthly credit system
This is again owing to the rapport building possible in a kirana store. Establishment of mutual trust between the customers and the store owner can give the customers perks of paying once at a time for all the purchases made earlier. This can prove to be a disadvantage sometimes as the credit needs to be recovered on time so as to keep the business afloat.
There is limited or almost no scope for a monthly credit system in supermarkets and hence payments have to be made at the time the items are bought. Credit cards can be used at supermarkets. With digitisation reaching every nook and corner of the country, now both kirana stores and supermarkets are equipped with the facility of digital payments.
Small scale kirana stores located in the neighbourhood also have delivery-to-the-doorstep option which comes in handy most of the time. Supermarkets are also now coming up with delivery systems, but there is a minimum limit on the number and price of the products that needs to be ordered to avail this facility.
In kirana stores, customers are dependent on the staff to serve them, while the supermarkets have all their products on display, this reduces the waiting time considerably and also gives the customer the option to compare all the brands and choose among them.
Supermarkets have an edge here. Due to their sheer size, they can have an attractive display of all their products, which has proven to improve sales and also reduce customers’ waiting time. They are equipped with a reasonable number of cash counters that helps in distributing the crowd.
Instor has been designing big supermarket brands across India successfully.
Instor is also renowned to provide a complete range of customised racks, shelves and fixtures to modernise small format kirana stores ranging from 100 sq ft to 1000 sq ft. Instor designs your store in such a way that your space does not look cluttered while offering you a maximum product display. Your kirana store or supermarket will get a unique, shopping-friendly look and it will bring you higher returns on investment. Instor designs are space-optimised and draw a higher inflow of customers giving the stores a fair chance to compete with supermarkets.
Scope for manipulation
Most kirana stores sell loose products, which leave a scope for adulteration. The quality of the products isn’t guaranteed, except for the packaged items. Supermarkets endorse a lot of renowned brands and hence the quality of the products can be assured. Customers are more comfortable with buying products that are associated with established brands than buying them in a loose fashion.
The increasing modernization in the field of retail has led to supermarkets popping up all over India, mostly in urban areas. There were just 500 supermarkets in 2000, and the number became a whopping 8.5 thousand by 2016. At the same time, there are over 12 million small stores in India, which account for 90% shares of the Indian F&G market. Even retail giants such as Reliance Industries, Walmart India, Amazon and FMCG companies like Hindustan Unilever have put an effort to create a range of engagement models to work with kirana stores that will help in modernizing them.
Both supermarkets and kirana stores, therefore, are profitable business models, and are important for the country’s economic growth. Choose your business carefully, work systematically, and grow. All the best.