In an appealing move that will probable benefit many small entrepreneurs, the big retail giant Amazon, is experimenting with a new distribution model that brings business to small ‘Kirana Stores’.
The debate on allowing FDI in retail in India has been long and bitter one. This debate was also an election issue; simply because the decision affects the livelihood of many members’ middle class and economically backward families whose immediate resort is these shop keepers. The trade-off between allowing FDI in retail is often painted as a choice, between preserving small-business owner rights and corporations taking over the country. American commerce brand Amazon may have come up with a solution that can please both the parties.
Earlier, reports of Amazon looking at new ways to bring kirana stores online surfaced, and the e-commerce giant was figuring out the logistics for it. Now, the company has launched a new platform called Kirana Now, just for this purpose. The platform will be launched in Bangalore first and will be rolled out in other cities in phases.
Amazon India’s country head Amit Agarwal confirmed the launch of Kirana. Now to Times of India. “We want to provide maximum convenience to customers when shopping for their everybody needs and enable them to shop from the ecosystem of their local stores on their mobile phones and get things delivered when they really need it.” He told the publication
Kirana Now is an India- only initiative, specifically targeted to bring the local market online. The new platform will let local baniyas upload their catalogs online, from where users can order for goods. The deliveries are expected to take an hour or two, and will be taken care by Amazon, the kirana owners and other third-party logistical companies roped in for this initiative.
The current food and grocery e-commerce scene is dominated by Big Basket. Even Local Baniya is an emerging player, with its presence in Mumbai, Pune, and Hyderabad. Additionally, Grofer app has tied up with local vendors to sell and deliver groceries.
But with an e-commerce giant like Amazon entering the space, it will boost small shopkeepers and kirana store owners to list their products online and perhaps understand the perks of e-commerce. Amazon has been dabbling with idea for long. Amazon’s Junglee even offers listing space to small offline sellers in seven cities across India- New Delhi, Kolkata, Mumbai, Bangalore, Hyderabad, Gurgaon and Chennai. However, buying transactions for any of the goods have to be done offline.
Amazon CEO Jeff Bezos, on his recent visit to India had stressed upon the need to get small businesses online. He also publicly supported Narendra Modi’s Digital India plans, and announced a further $2 billion investment in India’s e- commerce Industry.
Although Amazon isn’t the first site in India to use kirana stores and other local places to deliver products to customers. Sites such as Freshndaily, Edabba and AaramShop deliver their goods to shoppers using a combination of technology and tie-ups with offline companies.
However, no site has been able to gain momentous scale among kirana stores yet, its bit intricate because it’s tough to scale and maintain consistency and quality of customer service with kirana stores and also may be kirana guy who may not be tech-savvy to use technology- and that apart running his regular business. How would he able to proactively keep track of the products, use technology and run his regular business at the same time? It sounds very complicated. The customer experience is bound to suffer!
Amazon also runs a similar service in the US. It has set up pick-up locations which its customers use to collect their products when it’s convenient. But it’s quite diverse thing running your own pick-up where you can control the customer occurrence versus ‘Kirana Store’.
It’s relatively incredulous whether Amazon can do any kind of meaningful business through this channel. Others have tried in the past, but because of various reasons no one has really been able to scale up. If Amazon can crack it, the opportunity is huge.